It was reported on July 8 that yesterday, the Japanese MCU giant Renesas Electronics Factory was affected by a lightning strike, resulting in an instantaneous voltage drop and shutdown, which will affect the production capacity for about 2 weeks. Some analysts believe that this will affect the supply of automotive-grade MCUs.
And on Wednesday, Bloomberg reported that semiconductor lead times fell in June. According to data from the US financial research firm Susquehanna, the global average semiconductor delivery time was 27.1 weeks in May this year and 27 weeks in June, a decrease of about one day. This is the first time that semiconductor delivery times have fallen this year.Among them, the products with the largest drop in delivery time are the most popular chip products such as MCUs that were previously priced..
▲ Chip delivery time (Image source: Bloomberg)
MCU is a micro-control unit, also known as a single-chip microcomputer, which is a chip-level computer that appropriately reduces the frequency and specifications of the CPU (central processing unit), and integrates peripheral interfaces such as memory, USB, and drive circuits on a single chip. In recent years, driven by factors such as the Internet of Things, autonomous driving, and Industry 4.0, the use of MCUs in automotive electronics, artificial intelligence, Internet of Things, consumer electronics, and communications has increased significantly, with a global market size of $15.7 billion.
On the one hand, the market has reported that the MCU has collapsed and the price of the products of the world’s five largest MCU giants has been cut in half; on the other hand, Mercedes-Benz and other car manufacturers still believe that there is a shortage of automotive MCUs, and it is difficult to quickly restore the supply.
When the hottest MCU chip before is rumored to be crashing, what is the truth about the shortage? What kind of judgment and performance do the semiconductor players behind it have?
Demand for consumer MCUs slows, and automotive MCUs remain in short supply
recently,The news of MCU cutting orders is frequentAccording to the Financial Associated Press, MCUs with relatively rigid prices and in short supply have experienced an avalanche of quotations. The world’s five major MCU giants, including NXP, Microchip, Renesas Electronics, STMicroelectronics and Infineon, have halved their product quotations, especially at consumer-grade product prices. The most volatile.
An executive of a major domestic MCU manufacturer was interviewed by a reporter from China Securities Journal and said that the price of some domestic MCU products with small capacity and small package fluctuated, and coupled with channel inventory processing, the MCU market has greatly eased compared with last year, but products in different application fields have greatly eased. The situation is not the same.
According to the application field of MCU, it can be divided into four categories: consumer grade, industrial grade, automotive grade and military grade.The category with the greatest impact on the single wave of this time is consumer-grade MCU productsIndustrial-grade and automotive-grade MCUs have relatively little impact, and there are even shortages.
On the market demand side, the demand in the consumer electronics market represented by smartphones is slowing down.
According to the latest data released by market research firm CINNO Research, in the first quarter of 2022, smartphone sales in the Chinese mainland market were about 74.39 million units, down 14.4% from the same period last year. IDC data shows that in the first quarter of 2022, global smartphone shipments were 308 million units, a year-on-year decrease of 10.85% and a month-on-month decrease of 15.01%.
▲ Global smartphone quarterly shipments (Image source: Dongguan Securities Research Institute)
It is reported that when the global core shortage begins in 2020, MCU is one of the most tightly supplied chip products, and the price of some MCU chips on the market will increase by 5-20 times. While market demand is slowing down, downstream end customers and distributors have stockpiled a lot of consumer-grade MCU chips when they are in short supply.
Some chip dealers told Xinxie that after May 1st this year, chip prices began to drop. Dealers who had stockpiled more chips before began to ship gradually, but downstream customers have a large number of stockpiles. This has caused many dealers to cut prices to clear their inventories, forming a price war, resulting in a sudden drop in the price of consumer-grade MCU chips in the market.
However, it is really reflected in the market. According to industry insiders, the original quotations of MCU chips are different from those of different suppliers. Relatively speaking, the price change of the original chip factory is small, but the change of the dealer’s price is relatively high.
For automotive-grade MCUs, some product prices are still in short supply. According to the “Science and Technology Innovation Board Daily” report, the prosperity of automotive MCU products is still relatively high, and even IDM (vertically integrated manufacturing) manufacturers have specially added automotive-grade chip manufacturing or packaging production lines for this purpose.
Domestic MCU players make efforts to 32-bit, turning to high-end industrial control and vehicle-level
On the whole, the wave of consumer-grade MCU products will have a certain impact on domestic MCU manufacturers, but it also gives domestic MCU players the impetus to hit the mid-to-high-end market.
Simply put, the higher the number of MCU bits, the stronger the computing power. The current 8-bit MCU and 32-bit MCU are the mainstream products on the market. Compared with international chip giants such as NXP, Renesas Electronics, and STMicroelectronics, domestic MCU chip companies are weaker in the mid-to-high end, and the main market is 8-bit MCU chips, and these 8-bit MCU chips are mostly used in consumer-grade MCU products. .
▲ MCU applications classified by number of digits (Image source: Shenwan Hongyuan Research)
According to the prospectus of China Micro Semiconductor (Shenzhen) Company, the main players in the MCU business of A-share listed companies are GigaDevice, Zhongying Electronics and Chipsea Technology.
Zhaoyi Innovation was established in April 2005. Its main business is memory, microcontrollers and sensors. Its 32-bit MCU products use Arm Cortex-M3, Cortex-M4, Cortex-M23 and RISC-V cores, which are mainly used in industrial Controls, user interfaces, motor drives, power monitoring, alarm systems, consumer electronics and handheld devices, etc.
With the news of MCU product cut orders, Zhaoyi’s stock price fell by more than 7% during the session on July 4, and the closing price was 130.19 yuan per share, a decrease of 6.24%. As of the close on July 8, Zhaoyi Innovation reported 135.28 yuan per share, with a total market value of 90.295 billion yuan.
Founded in September 2003, Chipsea Technology is a full-signal chain chip design company. Its MCU products are divided into 32-bit and 8-bit, mainly used in industrial control, automotive electronics, smart home, consumer electronics and other fields.
Its deputy general manager Wan Wei and board secretary Huang Changfu answered in the investor relations event that the revenue share of Chipsea’s 32-bit MCU products has increased rapidly, from 10% in 2020 to 40% in 2021. The first quarter of the year accounted for about 50%, and it will continue to increase thereafter.
In 2020, Chipsea’s first automotive-grade MCU has passed the AEC-Q100 certification and has entered the new product design of the front-loading enterprise. At present, it is increasing investment in the research and development of automotive-grade MCUs. As of the close of A shares on July 8, Chipsea Technology reported 61.5 yuan per share, an increase of 2.11%, with a total market value of 8.601 billion yuan.
Zhongying Electronics was established in 1994, and its main products are industrial control MCU and OLED display driver chips. Its microcontroller chips are mainly used in home appliance main control, lithium battery management, motor control, and the Internet of Things. The first quarter financial report of Zhongying Electronics in 2022 shows that the sales revenue of industrial control chips accounts for about 80%.
On July 4th, after the news of the MCU cutting the order came out,Investors are also worried about industrial control MCUs, Zhongying Electronics shares fell 5.17%. On July 6, Zhongying Electronics stated on the interactive platform that its research and development is mainly used for the body control MCU part, and it is expected that there will be product tapeouts in the middle of the year. As of the close of A shares on July 8, Zhongying Electronics reported 46.80 yuan per share, down 1.47%, with a total market value of 16.007 billion yuan.
China Micro Semiconductor was established in June 2001 and is headquartered in Shenzhen. Its main business is 8-bit and 32-bit MCU chips. The main application fields of its products are home appliance control, consumer electronics, motor and battery and sensor signal processing.
On June 25, 2021, China Micro Semiconductor’s IPO was accepted by the Science and Technology Innovation Board. On June 14 this year, it was registered on the Science and Technology Innovation Board and will soon be listed on the Science and Technology Innovation Board. According to the prospectus, China Micro Semiconductor’s MCU chips are still dominated by 8 bits, accounting for 84.27% of its revenue in 2021, mainly used in the field of home appliance control. Although it already has 32-bit MCU chip design capabilities, the product line still needs to be enriched, and there are certain operating risks.
At present, China Micro Semiconductor is developing automotive-grade MCU products, and plans to use the domestic 110nm and below process to realize the research and development of automotive-grade chips such as vehicle instrument display control chips and realize import substitution.
Judging from the layout of domestic MCU players such as Zhaoyi Innovation, Chipsea Technology, Zhongying Electronics, and Zhongwei Semiconductor, most of them are shifting from 8-bit MCU products to 32-bit MCU products with more difficult technical development and wider market space in the future. And gradually from home appliances, consumer electronics and other fields to the more shortage of car-grade MCU products.
The capacity utilization rate of upstream wafer foundries is still over 90%, and domestic and foreign material manufacturers are expanding production
How will upstream fabs and semiconductor materials perform amid easing global chip demand?
In terms of wafer fabs, market consulting agency TrendForce believes that 8-inch wafer products (0.35-0.11μm) are greatly affected by consumer electronics demand, and the capacity utilization rate of wafer fabs dominated by consumer chips may fall below 90% , the capacity utilization rate of the remaining 8-inch fabs is about 90%-95%.
In terms of 12-inch wafers, the capacity utilization rate of some mature processes also fluctuates, but due to the more diverse products of 12-inch wafers, the overall capacity utilization rate of 12-inch wafer fabs will remain at around 95%.
▲ Foundry capacity utilization in the second half of 2022 (Image source: TrendForce)
On the whole, although the demand for consumer products has begun to ease, with the increase in the penetration rate of 5G smartphones and electric vehicles, the demand for semiconductors in the fields of 5G base stations, security inspection measures, cloud server requirements, and new energy vehicles has increased.In the future, the capacity utilization rate of wafer foundries will remain above 90%.
At present, leading wafer manufacturing companies such as TSMC, Intel and Samsung Electronics continue to expand production.
TSMC announced last weekend that in addition to three 12-inch fabs in Arizona, Nanjing, China, and Kumamoto, Japan, it will build 11 12-inch fabs in Taiwan this year and next.
Although Intel announced that the groundbreaking ceremony of its fab in Ohio was postponed, local media reported that its fab has actually started. Samsung Electronics continues to increase investment in the semiconductor field, and plans to expand the wafer production capacity of mature processes above 16nm. The main application areas are image sensors (CIS).
In the more upstream field of semiconductor materials, under the tide of fab expansion, price increases and expansion are the main theme of the industry.
In terms of materials, Japan’s Showa Denko, Shin-Etsu Chemical, Shenggao silicon wafer, photoresist, and chemical material leaders have all announced product price increases. The 2022-2024 production capacity of Taiwanese silicon wafer supplier Universal Wafers has been booked, and announced on June 27 that it will invest $5 billion to build a 12-inch silicon wafer fab in Texas, USA to expand production capacity.
In addition to international semiconductor material giants,Silicon wafer players in mainland China are also investing in production expansion.
Shanghai silicon industry plans to achieve 300,000 pieces/month of 12-inch silicon wafer production in 2024; Zhonghuan Co., Ltd. expects to achieve 600,000 pieces/month of 12-inch silicon wafer production capacity by the end of 2023, Leon Micro announced a new investment to produce 1.8 million 12-inch silicon wafers per year epitaxial wafer.
On the whole, for upstream wafer manufacturing companies and semiconductor material companies, the impact of the decline in demand for consumer-grade MCU products is not obvious, and it will take some time for the mitigation of downstream chip supply to pass to the upstream.
Conclusion: The demand for consumer-grade MCUs is declining, and the perception of foundry and materials is not obvious
With the decline in demand in the consumer electronics market, the supply of related chip products has eased. Consumer-grade MCU, as a chip type that was relatively short in the past, not only attracted many domestic manufacturers to join, but also downstream terminal enterprises have high stocking. This has caused a wave of orders and price cuts for consumer-grade MCU products today.
But at the same time, the demand for industrial control and automotive-grade MCU products is still relatively strong, and domestic MCU manufacturers are also making efforts in this field.Upstream wafer manufacturing and semiconductor material demand is still relatively strongthe overall slowdown in chip supply remains to be seen.
.
[related_posts_by_tax taxonomies=”post_tag”]
The post All beings behind the collapse of MCU chips: domestic players are rushing to the high end, and upstream manufacturers are still expanding production – yqqlm appeared first on Gamingsym.