The point of intelligence competition in 2023 has arrived. Can Chinese car companies that are short of cores win?

“ The first half of new energy vehicles is electrification, and the second half is intelligence.” BYD founder Wang Chuanfu said this a year ago. At present, the first half of electrification has not yet ended, but the whistle of intelligentization has already sounded in the second half.

2022 has passed. In the first half, electrification has changed the powertrain and energy utilization methods of cars; in the second half, intelligence with autonomous driving as the ultimate goal will be the "keyword" for car companies to move towards the high-end market in the era of electrification. stepping stone" and "killer trump card". Some people in the industry believe that intelligence will restructure the relationship between people and cars, the development logic of the automobile industry, and even the future shape of society as a whole.

Now that 2023 has arrived, in this game of intelligence, whoever can seize the throat of intelligence will win the opportunity for development.

A powerful “weapon” of intelligence

It is self-evident that chips play a vital role in the competition for automotive intelligence. We can even think that the key to the intelligent competition among car companies in the second half lies in chips.

Deloitte estimates that the average number of chips installed in fuel vehicles will reach 934 in 2022; new energy vehicles will be even worse, reaching 1,459, which is 2-3 times the demand ten years ago; high-level autonomous vehicles, single-car chips will reach 3,000 indivual.

Jikrypton Motors insiders have told the media that Jikrypton 001 is equipped with more than 10,000 chips; More than 10,000 pieces. According to relevant estimates, by 2030, the domestic automotive chip market will reach US$29 billion, and the number will reach 100 billion-120 billion units per year.

Zhang Yongwei, vice chairman and secretary-general of the China Electric Vehicles Association of 100, once said: "In 2022, China's intelligent vehicle penetration rate will exceed 30%, and this proportion is expected to reach 70% in 2030. Therefore, judging from the speed of intelligent vehicle development Judging from this, the demand for chips in the automotive industry will show explosive growth.”

However, it is a fact that demand has surged, and it is also a fact that the chip shortage has continued since 2020.

Source: BYD Semiconductor official website

At the 2022 Global Smart Car Industry Summit, Zhang Yongwei disclosed a set of data. Data show that in the past three years, chip shortages have led to a reduction in global automobile production of approximately 15 million vehicles, with China's production reduction exceeding 2 million vehicles. This proves the importance of chips to automobile intelligence and also reflects the severe damage caused by the shortage of chips to the automobile industry.

In addition, due to the lack of chips, many car manufacturers have gradually adjusted their equipment and reduced production since this year. According to relevant media observations, European car brands have reduced the number of electric seats, some even lack ADAS systems, and have reduced the number of wireless charging stations or digital instrument panels.

In this regard, both car companies and chip manufacturers have expressed their own anxieties. Wang Lang, deputy general manager of Chery Holding Group Co., Ltd., said bluntly when talking about the challenges of intelligent network connection : The challenges are very difficult, and the most typical one is "lack of core and lack of soul". Although there has been a shortage of automotive chips since the beginning of the year, by the end of the year, the new energy vehicle industry was still crying out for core shortages.

Horizon founder Yu Kai also said that in view of the current rapid increase in the penetration rate of electric vehicles, he expects the penetration rate of electric vehicles to reach 50% in 2025, and is therefore worried about the supply of automotive chips next year. "Faced with such a rapid growth rate, I am worried about whether the industry chain is prepared to meet the demand for electric vehicle semiconductors." Yu Kai said.

In fact, the shortage of automotive chips has been chronic for a long time, and there are many reasons for the current chip shortage.

For example, automotive chips are mostly purchased by supply chain system manufacturers rather than automobile manufacturers, making the supply chain more complex; automotive chips have a long design cycle and must meet a variety of strict standards, so it is difficult for automobile manufacturers to It is difficult to change suppliers in the short term.

In addition, when the epidemic broke out in 2020, automakers made misjudgments, believing that market demand would slump along with the epidemic, so they significantly reduced chip orders. But the reality is quite different. When automakers responded and began to increase chip orders, the fab production capacity was already occupied by orders for PC and smartphone-related chips at that time.

In addition, most automotive chips use mature process technologies. However, in recent years, the capital expenditures of many wafer fabs have been focused on advanced process technologies, while the growth of traditional mature process production capacity is limited. For example, TSMC’s advanced process plays a major role in the In the first quarter of 2020, the 7nm process accounted for 35%; and as of the first quarter of 2022, the latest 5nm and 7nm advanced nodes have contributed "half" to its revenue.

Nowadays, TSMC’s 3nm process technology has been officially launched in the US factory. However, according to McKinsey statistics, in 2021, 72% of automotive chips will use traditional processes above 90nm, while the proportion of automotive chips using advanced processes below 14nm will be only 6%.

Chinese chips in the cracks

It is worth noting that all of the above are the main reasons for the global chip shortage. For our country, the "chip shortage" situation is even more embarrassing. This is mainly due to the pressure exerted by the international environment.

Starting from the Trump administration, the United States has promoted sanctions on my country's acquisition of advanced process chips. The sanctions prohibit China from obtaining EUV lithography machines and prevent China from using any products and technologies containing American technology. They even unite with countries around the world to ban the supply of process chips below 14nm to China.

Since 2022, with the rapid development of my country's high-tech industry, the United States has tightened restrictions on my country's chip industry and launched a number of policies one after another.

In February 2022, the United States' "Chip and Science Act" restricted the investment and export of foreign chip companies in my country's chip industry and cut off the supply of my country's integrated circuit design software EDA; in March of the same year, the US government proposed a concept and advocated the establishment of The chip alliance formed by the United States, Japan, Taiwan, and South Korea has implemented a closed loop of chip production, excluding mainland Chinese companies.

In August 2022, the U.S. government asked chip design company Nvidia not to export to China two of the latest GPU computing chips used to accelerate artificial intelligence tasks; in September of the same year, the U.S. government asked AMD to ban the export of M250 chips produced by AMD to China. In October of the same year, the U.S. government issued a series of new regulations that would prohibit the sale of certain chips made with U.S. equipment to China. In addition, the U.S. government has also added 31 Chinese companies, research institutions and other groups to the so-called "unverified list," restricting their ability to obtain certain regulated U.S. semiconductor technologies.

Within just one year, the U.S. government launched a series of "combination punches" in an attempt to hit China's chip industry hard. These measures have indeed slowed down the development of my country's chip industry to a great extent.

Source: Horizon WeChat public account

For example, the United States restricts the export of high-performance data center GPUs (graphics processors) to China. This restriction involves NVIDIA's A100 and the upcoming H100 chips, as well as other chips that NVIDIA will launch in the future with peak performance equal to or exceeding the A100. Autonomous driving requires a lot of computing power, and Nvidia's GPU chips are crucial for training artificial intelligence systems. If the above-mentioned high-end chips are not used, it means that the training speed will be slower.

This also forces China's chip industry to face the fact that it relies on imports. In this regard, Zhang Yongwei said bluntly, "Looking at it now, getting rid of import dependence is still a top priority."

However, the supply rate of domestic automotive chips is less than 10%, with the lowest being less than 1%. In other words, more than 90% of the chips required for each car are imported or in the hands of foreign-funded companies. This determines that whether it is ordinary chips or some key chips, especially smart chips, the demand will be increasing in the future. Big, but the bottleneck is getting higher and higher.

Data show that the global automotive chip market size in 2019 was approximately US$47.5 billion, of which China’s independent automotive chip industry totaled less than 15 billion yuan, accounting for less than 4.5%. Global automotive-grade chips have formed a high degree of monopoly. The seven major suppliers of Infineon, Renesas, NXP, Cypress, STMicroelectronics, Texas Instruments, and Microchip occupy 98% of the global MCU market.

Why is it difficult for domestic chip manufacturers to get a share of the pie? Under successive attacks from the United States, how can auto companies that are short of cores go on?

How do car companies handle themselves?