ST’s four major end markets are automotive, industrial, personal Electronic equipment, and communication equipment/computers and peripherals. In the automotive and industrial markets, it has a comprehensive layout, while the other two markets adopt selective layout strategies, making full use of its core competitiveness and general product lines to fully cover the four terminal markets.
Wen ︱ Li Yi
A few days ago, Mr. Jean-Marc Chery, President and CEO of STMicroelectronics (ST), shared the company’s strategy and goals and answered related questions at the online communication meeting in Greater China and South Asia. He pointed out that the Asia-Pacific region is one of ST’s most important markets, and its development direction is of great significance to ST. Also attending the communication meeting were Marco Cassis, President of Marketing, Communications and Strategic Development of STMicroelectronics, and Jerome Roux, Executive Vice President of Marketing of STMicroelectronics Asia Pacific.
Empower the three major trends and lay out strategic markets
Jean-Marc said that trends determine strategic investment decisions and product planning, and also help solve some of the major challenges faced by customers and the world. ST uses advanced technology to deploy long-term strategic markets in advance, focusing on three major trends: smart travel, power and energy, Internet of Things and 5G. In the past year, these three major trends have accelerated their development, driving market demand for ST products.
Travel smart. Smart mobility is to help automakers make driving safer, more environmentally friendly, and more connected, while improving driving comfort and convenience. With the interconnection of hybrid and plug-in electric vehicles and their infrastructure, the popularization of digital services and applications, the future will shift from traditional vehicles to smarter travel solutions. Smart mobility is the key to managing urban traffic, reducing fossil fuel dependence, air pollution, and road traffic accidents.
ST provides customers with a broad product portfolio to support the fundamental transformation of the automotive industry. For example, high-efficiency power devices based on silicon carbide technology and battery management solutions for key subsystems of electric vehicles, and advanced multi-core microcontrollers for next-generation automotive architectures.
Electricity and energy. The most important thing in this field is to allow different industries to comprehensively improve energy efficiency and renewable energy utilization. Global energy consumption is increasing rapidly, especially for industrial applications. With increasing reliance on the Internet and cloud services, the capacity of data centers continues to expand, further increasing energy demand, and it is necessary to greatly improve the operating efficiency of infrastructure, such as upgrading the power distribution network and implementing smart grid technology. As a key focus area, ST has made a number of strategic investments and promised to use 100% renewable energy in daily operations by 2027.
Internet of Things and 5G. With billions of personal, corporate, and public devices connected to the cloud, our work, living places, car driving, and the devices we use will all change. The increase in data transmission efficiency and the reduction in latency of IoT devices will enable 5G technology to play a key role in promoting service penetration. ST is committed to supporting the development of smart and interconnected IoT devices, realizing smarter homes and buildings that are more energy-efficient, safer, and more convenient; smart cities that are more environmentally friendly and have a higher quality of life; smart factories that are more flexible, more efficient, and safer And workplace.
In this regard, ST in addition to providing the necessary modules and development ecosystem for STM32 embedded processing solutions, it also provides sensors, independent connectivity and security solutions, as well as analog and power management products required for the complete system.
Persistence in the value proposition
According to Jean-Marc, based on the above three trends, the company formulated its development strategy three years ago. Despite the special situation of the epidemic, the basic principles of the strategy have not changed. We will continue to make the company stronger and bigger, ahead of the market it serves, and provide first-class services to customers and partners.
As a company, the first is to create value:
Create value for shareholders, promise to return value, and achieve the dual goals of sustainable development and profitable growth;
Create value for customers and provide differentiated enabling elements to help them succeed in their respective fields, including technology, IP, products, application knowledge and related ecosystems;
Create value for stakeholders, adhere to the principle of sustainable development, maintain integrity, put people first, and pursue excellence.
In terms of R&D investment, ST’s annual expenditure is about 1.5 billion U.S. dollars, and it is expected to be 2 billion U.S. dollars this year; at the same time, it uses mergers and acquisitions to control resources and know-how to accelerate the development of technology and product portfolios. For example, ST acquired three companies last year, and the acquired assets will be used to expand the wireless connectivity capabilities of STM32. Recently, ST also acquired a company that specializes in artificial intelligence development tools. In addition, in terms of gallium nitride, ST acquired most of the shares of a related company to accelerate the speed of providing gallium nitride products to the market.
The combination of investment length and shortcomings is very important, especially when the global semiconductor supply chain is tight and the demand for chips in all terminal markets is very large. ST is working closely with all customers and partners to overcome difficulties in the industry.
Four major terminal markets show hard-core strength
Jean-Marc said that ST’s four major end markets are automotive, industrial, personal electronic equipment, and communication equipment/computers and peripherals. In the automotive and industrial markets, it has a comprehensive layout, while the other two markets adopt selective layout strategies, making full use of its core competitiveness and general product lines to fully cover the four terminal markets.
How to achieve the company’s strategic goals? He explained that based on proprietary technology (or carefully selected technologies from other companies), ST provides products to more than 100,000 customers. There are six categories of product portfolio and layout: special automotive ICs, discrete devices, and power transistors for smart travel; analog devices, industrial and power conversion ICs for power and energy, as well as general-purpose MCUs and MPUs, security MCUs, and EEPROM memories; the Internet of Things And 5G, there are MEMS and optical sensor solutions, as well as ASIC dedicated chips using ST technology.
Enriched product portfolio to facilitate strategic development
How to be different? Jean-Marc said: “Differentiated technology is our cornerstone.” For decades, ST has long-term investment in the basic technology used in product design and manufacturing, and has developed many proprietary technologies to provide customers with continuous improvements. Good solution. These technologies include:
Traditional CMOS technology, such as the embedded non-volatile memory technology used in the MCU product family;
BCD and other smart power technologies are key technologies for power management and motor control solutions;
MEMS technology is applied to motion and environmental sensors, and micro-actuators such as micromirrors or inkjet print heads;
The imaging technology used by time-of-flight sensors and optical sensing solutions;
A series of power discrete device manufacturing technologies, including IGBT, silicon MOS and wide band gap materials-silicon carbide (SiC), gallium nitride (GaN).
ST has also established partnerships with other market leaders to jointly provide customers with first-class products to meet or exceed customer needs and expectations.
Differentiated technical capabilities
Strategic goals lead the market covered
Speaking of strategic goals, Jean-Marc said that ST has a wide-ranging layout in the automotive market, providing a variety of dedicated and customized automotive semiconductor solutions to meet the needs of global customers, including many customers in the Asia Pacific region who are keen to innovate. The goal is to become an electric vehicle. And digital leader.
In the industrial market, as a leader in embedded processing technology, ST has a wide-ranging layout for key targets, especially focusing on providing solutions for Asian customers in the largest industrial product market. ST’s products have the smart technologies and functions needed to develop various industrial applications. Today, ST is already one of the leading MCU manufacturers in Asia, with a rich product lineup and software ecosystem, attracting more developers’ attention.
Two other important targets for the industrial market are the analog devices and sensor business, and the power supply and energy management chip business. ST pays special attention to important industrial technologies, including motor control, power supply, metering and electrical isolation technologies. Industrial-specific sensors, power discrete devices, including wide band gap technologies (such as silicon carbide), as well as IGBTs and silicon-based MOSFETs, all help ST expand its product portfolio for industrial power supply and motor control related applications.
In terms of personal electronic products, ST’s target market is large-scale smart phone applications, providing advanced differentiated products and customized solutions. With the rapid development of 5G smart phones and wearable devices and accessories, the growth in the number and content of the Asian market will bring considerable returns.
In the communications equipment, computer, and peripheral markets, ST’s strategy is to precisely target targets, seize market opportunities, make full use of differentiated proprietary technologies, such as hard disk drives, printers, and cellular/satellite communications technologies, and deploy a wide range of product portfolios, including STM32 series, power and discrete devices, analog products and MEMS.
In-depth communication, release heavy signals
After sharing, Jean-Marc conducted extensive exchanges with the media, which further proved ST’s foresight.
Silicon carbide devices have been improving
Jean-Marc said that ST formulated and implemented SiC product and solution improvement plans based on the needs of upstream and downstream partners in the value chain. Its SiC MOSFETs can be delivered in a variety of forms, one of which is a custom design, such as Tesla’s custom module; the other is a dedicated standard module, which develops its own solution through cooperation with third-party packaging and testing manufacturers-ACEPACK, also Provide die for cooperative module manufacturers.
The first improvement of ST products is to improve the performance of the module itself, because electric vehicles, especially the two main automotive scenarios related to SiC, require improvements in the performance of inverters, on-board chargers and DC/DC converters. Then there is the improvement of the manufacturing process, the third-generation mass production of SiC uses planar manufacturing technology. Over the years, ST has accumulated valuable R&D experience in reliable and high-performance third-generation technology, and is currently developing fourth-generation manufacturing technology to continuously improve the high stress and electrical performance of MOSFETs.
Innovation in raw materials and epitaxial layers is the key to the realization of the manufacturing process. Two years ago, ST acquired Norstel and developed its own 6-inch wafer manufacturing technology. The test results proved that its technical performance is higher than that of its competitors. Recently, it also delivered the first 8-inch SiC wafer, and plans to manufacture test diodes on this wafer, and then do MOSFET tape-out and testing later.
Technological innovation provides important opportunities for the improvement of application modules, chip manufacturing processes, wafer epitaxial layers and raw materials. ST will therefore become one of the few semiconductor companies with a fully vertically integrated supply chain. This model is an important advantage for controlling the supply chain in competition.
Dealing with chip shortages
Jean-Marc pointed out that there is a huge gap between semiconductor industry demand and prepared capacity. It’s not that the chips are out of stock, but that they are not ready for production. In the entire value chain, from electronic components, OEMs to EMS foundries, whether it is independent devices or embedded electronics, every market participant is not prepared for the market blowout.
St Revenue will also exceed 12 billion U.S. dollars.
He believes that the current supply and demand gap is still around 25%. Therefore, there is no other way to solve the problem of chip shortages in the short term, but to work closely with all customers, car companies, first-tier suppliers, and industrial OEMs to prevent shortages as much as possible. Stop production, control the degree of loss, and reduce the impact on customers.
After 2022, ST is discussing lessons learned and preventive measures with customers, how to better plan future production, and how to provide more reliable demand forecast information for the semiconductor supply chain, so that semiconductor companies can prepare flexibly and make low-risk production capacity. Prepare.
Jean-Marc explained for example, the challenge that the semiconductor industry faces is that the manufacturing cycle of a car is one day, but the manufacturing cycle of circuit boards is one week, and the capital expenditure is very large. The lead time for wafer manufacturing equipment is 9 months, and for packaging and testing equipment is 6 months. We must find a way to adjust the traditional business model of the automotive industry to make it more consistent with material demand planning and rolling forecasts, and achieve flexibility and variability, so that the semiconductor industry can plan its production capacity in advance. This is what ST is doing with customers.
Promote the reform of the automotive industry chain
Jean-Marc told reporters that in terms of strategy, ST is a pioneer in promoting the successful transformation of the automotive industry from internal combustion engines to electric vehicles. It has been involved in SiC diodes and MOSFETs 20 years ago. And electric cars are essential. Thanks to a diversified product portfolio, including MCUs, power drive devices, BCD technology, high-performance analog chips and sensors, ST is providing power chip solutions (power switch tubes, SiC MOSFET modules, vehicle chargers, motor control, DC/ DC converter, power battery management system) has unique advantages.
He pointed out that in the automotive field, software is becoming more and more important, so it is necessary to establish a close cooperative relationship with customers, using embedded processors and various types of sensors to optimize the powertrain system of electric vehicles. In terms of intelligence, subsystems including infotainment, navigation and positioning, network connectivity and ADAS provide new opportunities for many new market participants, because every major breakthrough that changes the competitive landscape will create opportunities for new entrants. Provide an efficient platform. But for ST, business is business as usual.
ST is a global company that can localize applications in laboratories and design centers to achieve more and more localized designs. In different regions, ST’s business model and technical cooperation model may be slightly different, but they are all based on smart travel and vehicle electrification strategies.
According to reports, ST has established joint laboratories and partnerships with major car companies in the Asia-Pacific region to lay out the overall ecosystem of the future automotive industry in terms of electrification and intelligence, especially some new market participants brought by localization. , Such as BYD, Chang’an, Great Wall, SAIC, etc.
Leave the group and fly solo will not succeed
Now, the European Union, Japan, the United States, and South Korea are all pursuing chip autonomy and controllability.As a global operating company, what does ST think?
Jean-Marc said: “This is a dangerous thing. Observing the status quo of the semiconductor industry’s competitive landscape, the entire industry is divided into computers, communications, memory and diversified devices. There are about 25 companies with a market value of more than 10 billion US dollars, and there are two types. Operation model: One is fabless and the other is IDM. Among them are 3 computer and microprocessor companies, 5 communication chip companies, 5 memory companies, and 8 product diversified semiconductor companies, including ST. In In the foundry field, there are three listed companies with a market value of more than 10 billion U.S. dollars, namely TSMC, UMC and SMIC, and two are not listed (GlobalFoundries and Samsung). In addition, there are three major EDA companies and five major companies. Process equipment manufacturers. At this stage, it is very important to ensure the continuous development and innovation of the semiconductor industry. Countries provide incentives to encourage fair innovation and balanced manufacturing. This is what we expect and the direction of future planning.”
He pointed out that ST does not plan to lay out a world where only local development of IP, local design, local R&D and local manufacturing can carry out business. This is not the world it plans. Although we can see important political will from the government’s encouraging policies, we still hope that these policies can promote fair competition and advance the development of the industry. He believes that under the current situation of chip shortage, this situation is also normal.
Some customers are also changing their minds and are open to capital participation. ST does not plan to support completely independent initiatives and actions for chips in certain countries. Don’t forget that behind the fab and manufacturing technology, there is also a packaging and testing plant, which is a complicated back-end process. Equipment manufacturers are required to provide wafer manufacturing and packaging equipment, and EDA suppliers are also required to provide IP and design tools. With the advent of artificial intelligence, technology research and development has become more important, and finally there will be material manufacturers.
The manufacturing structure is changing, and the market concentration is not high, but this is not something to worry about. The ST strategy, which operates as an IDM model, originated from the general trend of society. It will deploy technology innovation centers and application laboratories in Europe and Asia through self-regulation to provide diversified semiconductor products for the automotive and industrial markets. It is still a global operation.
“Decoupling from the world will bring disasters to the semiconductor industry. It is not feasible for some countries and regions to leave the group and fly solo. This will not happen. I understand this idea, but I think it is not conducive to the long-term development of the semiconductor industry. “He said.
Differentiation and convergence
Every chip manufacturer is emphasizing differentiation, but through acquisitions in recent years, there has been a trend of technological convergence among major chip manufacturers. How to look at differentiation?
Jean-Marc cited embedded processing solutions as an example. Before a certain point in time, the industry standard for evaluating microcontrollers was based on CMOS technology, followed by embedded NOR flash memory or embedded split gate technology. Differentiation is more about building a software ecosystem around ecosystems and microcontrollers to simplify the solution design process. Equally important is extensive product planning. At a certain stage of microcontroller development, differentiation is mainly concentrated on product mix. STM32 is a broad product portfolio that provides high performance and low power consumption, and continues to support a strong development ecosystem.
Now, process nodes are shrinking continuously, which can provide higher real-time performance according to application and power consumption. Opportunities for differentiation still exist, such as split gate alternative technology developed by ST and 28nmPCM phase change memory technology. ST’s 28nmFD-SOI technology car gauge microcontroller has built-in PCM memory and flash memory, and the next generation of product technology is under development.
In terms of power devices, ST’s differentiated approach is to develop wide band gap materials, develop modules, improve BCD architecture and technology, as well as galvanic isolation technology, system-on-chips capable of handling high voltages, and smart functions.
The differentiation method of optical sensors is to develop integrated solutions such as time-of-flight technology, modules and infrared imaging to provide customers with overall solutions.
He introduced that ST’s Agrate and Crolles plants use BCD and CMOS technologies to develop and manufacture high-performance analog technologies. In order to achieve diversification and differentiation, ST selectively broke away from the communications market more than 10 years ago and moved to the automotive and industrial markets, because this is an opportunity to provide differentiated products.
Opportunities and Challenges
With the increase in vaccination rate, the world may usher in an industrial recovery. For the semiconductor industry, where are the opportunities and challenges in the future?
Jean-Marc said that before the epidemic, the company’s strategy originated from important electronic system development trends, including smart travel, power and energy, the Internet of Things and 5G. As a diversified semiconductor company, its product portfolio includes embedded processing solutions (microcontrollers based on STM32), power management solutions, optical sensing solutions, MEMS sensors and analog devices. “We are not among the advanced digital core technologies, but we have some specific partnerships, especially in the area of automotive intelligence. We are cooperating with Mobileye to develop autonomous driving applications,” he said.
For personal electronic products, communication infrastructure and equipment, ST’s strategy of choosing the layout will not change, and it is ready to continue to lead the market it serves. In terms of manufacturing technology, the embedded processing solution development roadmap includes 28nm, the next node of FD-SOI technology, and the investment in the subsequent processes and intermediate production lines will be more radical. Through cooperation with TSMC and Samsung, more advanced CMOS technology will be used to develop industrial microprocessors.
In terms of power devices, ST is developing advanced wide band gap materials, such as fourth-generation SiC products and GaN devices, and is also developing a new generation of IGBT, low-voltage MOSFET and BCD technologies.
The current advanced automotive semiconductor technology is 110nm, and the advanced consumer electronics technology is the 90nm node. ST will develop the next generation of 40nm technology. As for internal production capacity, all of its manufacturing facilities have been operating at full capacity, and plans to build a new 300mm wafer fab in Agrate, and start to install production lines in 2022 to support ST’s development in the next 3 to 5 years.
Jean-Marc believes that the challenge after the epidemic is that it is very important for customers to survive and continue to grow. It is necessary to understand and avoid structural damage to customers due to the overwhelming burden of the ST supply chain; it is very important to protect customers. It is important to analyze the relationship between demand and production capacity. Make adjustments in time for gaps. Another challenge is the decoupling phenomenon of the semiconductor industry, which will interrupt the globalization process of the semiconductor industry.
He believes: “The key to the success of the semiconductor industry is innovation, globalization, and scale. This allows the industry to complete the transformation of innovation results at a price that customers can afford. In the future, countries around the world should support this kind of fairness and equality through various incentive policies. Innovation.”
Accelerate development and innovate together
Jean-Marc finally emphasized: “We will invest in the key technologies needed to support the development of the empowerment trend of the electronics industry for a long time, and target those specific markets and application areas that benefit from our technology while increasing the technology adoption rate. We develop innovations , Sustainable technology, and products and solutions that customers need to help them cope with challenges and opportunities. The close cooperation of customers, partners, and ST employees will accelerate development and achieve innovation together.”