Truck companies with chip shortages stop production, domestic substitutes are weak

The scope of the chip supply shortage is expanding and has now spread from consumer electronics to the automotive field. The auto industry, which has just eased from the epidemic and is recovering, has suffered another sap. Some auto factories, including Volkswagen and Honda, have stopped production.

  Truck companies with chip shortages stop production, domestic substitutes are weak

Auto companies respond to the three companies: reduce production, switch production, and find replacements

A few days ago, GAC Group said in an interview with The Paper: “Due to the spread of the new coronavirus, the global economic situation has been affected. Some of our companies have also received warning messages from suppliers that the supply of parts and components of certain models will be affected. Still rolling confirmation.”

Relevant persons in charge of Guangzhou Automobile Honda and Dongfeng Honda also stated that they have received warnings of supply shortages, but the production of some models is currently affected, and the entire plant is operating normally and will not stop production. The situation in Japan is not so optimistic. According to a report by the Finance Associated Press, Honda Motor is preparing to cut production due to a shortage of automotive chips. In Japan, the production of some models has been suspended due to a shortage of chips. Models) to ensure production.

Earlier, according to the Nikkei Chinese website, Honda Motor announced that due to the shortage of automotive chip supply, Honda Motor announced that it will adjust its production rhythm. The domestic production in Japan will be reduced by 4,000 vehicles in January, which will mainly affect a factory in Suzuki City, Mie Prefecture, Japan. The “Fit subcompact” mini car produced.

Due to insufficient supply, Honda Motor suspended production at its British plant on Tuesday and Wednesday, but has resumed production on Thursday. According to predictions from relevant sources, Honda will increase its production cuts later this year, because starting from February, the lack of chips may become more and more serious, which will affect thousands of domestic automobile manufacturing in the first quarter. .

In addition, due to a fire at Asahi Kasei’s semiconductor plant in Miyazaki Prefecture in October 2020, the supply of semiconductors for car audio equipment has been intensified. However, Honda said for the product that “stocks have been secured at this stage” and the production cut is considered irrelevant.

  Truck companies with chip shortages stop production, domestic substitutes are weak

In fact, as early as December last year, the automotive industry was already affected by the shortage of chips. Volkswagen also officially recognized the fact that there was a shortage of semiconductor chips. It is reported that their joint venture plant in China has almost ceased production as a result, and will adjust its production. Production plans for factories in China, North America and Europe. Affected models include Volkswagen’s own brands, as well as Skoda, SEAT, and Audi. Murat Aksel, Volkswagen’s board member responsible for overseas procurement, said, “We are now clearly feeling the impact of the reduction in global semiconductor supply.”

In response, the Volkswagen Group responded that although the chip supply was affected, the situation was not as serious as the rumors. At present, it has coordinated with the headquarters and related suppliers, and the delivery of related vehicles has not been affected.

According to The Paper at the time, Volkswagen Group (China) responded that the uncertainty brought about by the new crown epidemic has affected the supply of chips for some specific automotive Electronic components. At the same time, the overall recovery of the Chinese market has further promoted demand growth, making the situation more severe and causing some car production to face the risk of interruption.

According to the “Associated Press”, people close to SAIC Volkswagen said that SAIC Volkswagen has suspended production of some low-end models, but this is also consistent with the company’s strategy of moving its overall products to high-end this year.

For Toyota, in late November 2020, some executives said that “the production of complete vehicles after April 2021 may be stagnant”, showing a sense of crisis. According to reports, in addition to discussing alternative procurement options for semiconductors, they are also considering to equip them with a new specification system that changes the component composition in advance.

However, Hongqi, GAC, SAIC-GM, FAW Toyota, Beijing Benz and other new car manufacturers, such as Weilai, Xiaopeng, Ideal and other new car manufacturers, said that the impact was not large. BYD even said that the company has a strong The entire industrial chain can not only be fully self-sufficient, but also have a surplus of external supply.

Tier 1 manufacturers said: All upstream chip manufacturers are not doing well

In addition to automakers, auto parts suppliers are also facing challenges.

In recent years, with the acceleration of automobile intelligence, chips have increasingly appeared in automotive industry applications to help automobiles solve power and transmission, automatic driving, body comfort, and in-vehicle infotainment functions.

Generally speaking, it takes more than 3 months from inputting materials to forming products for semiconductors, and it is difficult to flexibly increase production. In the first half of 2020, the epidemic has led to a sharp drop in demand for automobiles. Automakers temporarily reduced the purchase of semiconductors, and semiconductor manufacturers adjusted their production plans accordingly.

Since the second half of 2020, due to the “home economy” caused by the epidemic, home office has become a major trend, and the demand for smart phones and personal computers has increased. While semiconductor manufacturers are vying for production capacity, the production capacity of semiconductors used in vehicle control systems has been eaten up, and the supply of semiconductors to auto parts manufacturers has stalled. However, as China has brought the epidemic under control after the summer of 2020, and automobile production has recovered rapidly, the supply capacity of on-board semiconductors has not yet been adjusted and cannot keep up with demand.

It is understood that the shortage of automotive chips this time mainly occurred in upstream companies. In an interview with the Global Times, a person in charge of an auto parts manufacturer revealed that the shortage of auto chips this time is mainly in ESP (Electronic Stability Program System, the standard is called ESC, ESP is a Bosch patent) and ECU (Electronic Control Unit). ), which may cause the on-board computer module to fail to produce normally, thereby affecting vehicle manufacturing.

There are mainly 7 global ESP suppliers, namely Aisin under Toyota, Hitachi exclusively for Nissan, Nissin exclusively for Honda, and Mando for Korean models. These 4 companies basically only supply the group. The other three are all German manufacturers, including Bosch, Continental and ZF.

The supply of domestic automakers mainly comes from Bosch and Continental. Bosch almost monopolizes the domestic market, especially its own brands, and it is also common in Mercedes-Benz, Audi, Cadillac, and Buick. Continental mainly supplies Volkswagen, BMW, PSA, and Mercedes-Benz, while ZF mainly supplies American cars.

Some analysts said that Continental Group and Bosch Group purchase chips and then assemble them into related modules to supply automakers. As the global chip industry is facing shortages, the production of Continental and Bosch is facing difficulties. The two major auto parts giants successively issued supply chain warnings.

Bosch said, “The manufacture of some specific automotive electronic components is increasingly dependent on chips. However, the pandemic has hit global production, and there may be a shortage of components required for automotive production.”

  Truck companies with chip shortages stop production, domestic substitutes are weak

Continental said that although semiconductor manufacturers have begun to expand their production capacity to cope with the sudden increase in supply demand, considering the normal delivery time of the semiconductor industry, the current supply shortage will improve within 6-9 months, so it is expected to The supply situation in 2021 will remain severe.

 Global automotive chip suppliers continue to increase prices

Out of stock means price increases. According to the latest report from Strategy Analytics, a market research organization, the top five automotive semiconductor manufacturers in the world in 2019 are Infineon, NXP, Renesas Electronics, Texas Instruments, and STMicroelectronics. From November 27 last year, global automotive chip suppliers began to increase prices.

On November 27, NXP was the first to issue a price increase letter, in which it stated that in order to solve the unforeseen cost increase brought by suppliers, the company “reluctantly” increased the prices of all products.

On November 30, Japanese semiconductor manufacturer Renesas Electronics sent a product price increase notice to customers, stating that due to the increase in the cost of raw materials and packaging substrates, it plans to increase the prices of some analog and power products starting from January 1, 2021. Renesas also explained that the company is currently facing inventory, cost increase pressure and product transportation risks, and it has to raise prices to ensure that these products are continuously invested and produced.

Affected by the epidemic, packaging and testing plants in Malaysia and the Philippines have successively announced the suspension of work, and STMicroelectronics’ strikes have increased the loss of global semiconductor production capacity.

“In recent years, the global chip industry’s capacity investment has been relatively conservative, and the imbalance of supply and demand has already manifested before the epidemic. The epidemic has intensified the cautiousness of capacity investment. In the second half of the year, the development of China’s auto market is getting better, anticipating and insufficient preparations.” The China Association of Automobile Manufacturers believes.

However, Li Shaohua, deputy secretary-general of the China Automobile Association and Minister of Industry Development, said in an interview last December that the shortage of chip supply reported by the media is real, but it is not as serious as some media reported. The superimposed influence of multiple factors has caused the contradiction between chip supply and demand to appear concentrated in this time period.

“Due to the shortage of chip supply, the production of some companies may be greatly affected in the first quarter of next year. At the same time, all aspects of China’s auto industry should rationally treat the imbalance of chip supply and demand, and market-level influencing factors will change over time. Gradually be alleviated.” Li Shaohua said, “However, for the whole year of next year (2021), the impact of the chip shortage will not be too great, and it is currently difficult to make a quantitative estimate.”

  Overseas chip supply is insufficient, and Chinese manufacturers are unable to fill the market

The epidemic has affected the supply of overseas chips, leading to limited production capacity of some auto companies in the short term. Experts believe that the shortage of chips encountered by car companies this time also exposed the current shortage of domestic car-level self-developed chips, and it is difficult to seize the opportunity to replace them.

  

Picture from: Forward-looking Economist

According to wind data, the current self-research rate of automotive chips in the domestic automotive industry only accounts for 10%, and 90% of automotive chips must rely on imports from abroad.

The “China New Energy Vehicle Supply Chain White Paper 2020” released by the consulting company Roland Berger shows that among the top 20 global automotive semiconductor industries, local Chinese companies only occupy one seat.

“China’s New Energy Vehicle Supply Chain White Paper 2020” shows that in China’s annual 28 million car market, China’s automotive semiconductor production value accounts for less than 5% of the world, and the import volume of some key components is 80%-90%. Other statistics show that the global automotive chip market in 2019 is about 310 billion yuan, and the domestic automotive-grade chip industry scale is less than 15 billion yuan, while the scale of my country’s automotive industry accounted for more than 30% of the global market during the same period.

According to the Global Times, a corporate executive who is engaged in the research and development of automobile engine ECUs stated that at present, only motorcycles and some vans engine ECUs in my country can use domestic chips. Other engine ECUs are basically foreign products and run through foreign software operating systems. . Foreign auto chip manufacturers Infineon and NXP are leading the domestic auto chip market. Once these companies suspend supply, China’s auto industry may face a crisis.

Li Xingyu, Vice President of Horizon Market Development and Strategic Planning, said: “At present, the automotive chip industry is in a state of’a hundred schools of thought and a hundred flowers blooming.’ However, my country’s automotive chip companies started late and their overall development is slow. Especially the development cycle required for automotive chips is relatively long. Factors such as long-term growth, higher thresholds for entrepreneurship, and longer return periods have resulted in fewer players in the market.”

Based on this, the “New Energy Vehicle Industry Development Plan (2021-2035)” officially released in November 2020 clearly stated that it will focus on the development of auto-driving technologies and equipment such as vehicle control operating systems and computing platforms, and vehicle-level chips.

With the continuous strengthening of trends such as automotive intelligence and electrification, the global automotive chip market continues to grow, and accelerating the completion of the independent supply system of key automotive chips may become an important issue for the development of the domestic automotive industry. However, if domestic cars strengthen the application of domestic chips, it can force domestic car chip technology to improve and promote production, so as to solve the problem of car chip shortage, and the development of independent car chips will usher in a good opportunity.

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