The chip shortage problem that has lasted for nearly two years is still affecting the heartstrings of the automobile industry.
According to auto forecast solutions, the auto industry data forecasting company, as of October 30, due to the shortage of chips, the global auto market has lost about 3.95 million cars this year. According to the forecast, by the end of this year, the cumulative production reduction in the global automobile market will climb to 4.2785 million vehicles, an increase of about 16200 vehicles compared with the previous estimate.
“The problem of lack of core has not been solved, and the forecast for next year is not optimistic. Many chip suppliers report that they cannot meet the purchase demand of Bosch next year.” On the 2022 Automobile and Intelligent Transportation Technology Innovation Experience Day held by Bosch, Xu Daquan, Executive Vice President of Bosch China, said in an interview with media including the 21st Century Economic Report that there is still a gap in the supply of automobile chips, and some chips are in a big gap.
Many auto makers also said that by the first half of next year, the production capacity will still be affected by the shortage of chips.
“The mistake was made three or four years ago”
The problem of “core panic” has impacted the global auto industry. Since this year, most auto companies have repeatedly mentioned “the impact of the COVID-19 and the tight supply of parts” and “the impact of the tight supply of parts” in their monthly sales press releases. Sales have not been as expected, and Toyota, Honda and other auto companies have repeatedly announced production reductions.
Zhu Huarong, Chairman of Chang’an Automobile, said frankly at an automobile forum a few days ago that “lack of core and expensive electricity” is the “most painful point” facing the development of China’s automobile industry. Chang’an Automobile lost 606000 vehicles in the first nine months. The soaring price of chips has directly led to the increase of the procurement cost of the OEMs. At the initial stage of new product launch, due to chip shortage, the order delivery cycle was prolonged, which seriously affected the pace and sales of new product launch and the corporate brand image.
“The main reason for the shortage of chips is that the development of new energy vehicles is too rapid, and the demand for new energy vehicles, intelligent electrification, and in car chips has increased dramatically. As a result, the production capacity of car scale chips cannot meet the demand of the whole market for chips.” Xu Daquan believed that this mistake was “committed three to four years ago”. At that time, Tier1 and OEMs did not predict the rapid growth of new energy vehicles and smart cars, nor did they place orders with chip companies three or four years ago.
Zhu Huarong believes that the reasons for the shortage of domestic chips are mainly reflected in four aspects: key technologies are subject to foreign restrictions, the contradiction between chip market demand in a short period of time and the long cycle of chip production increase, structural shortage is becoming normal, and there is no risk sharing cooperation relationship.
Although there is a shortage of vehicle scale chip capacity in some fields at present, the chip price has risen, and the supply cycle has been extended, in Xu Daquan’s view, making automobile chips alone is a high-risk investment, and a new wafer factory needs a long period from deciding to invest, starting to build a factory, introducing equipment to the end of the climb.
“On the one hand, in the whole chip industry, the demand for automobiles accounts for only 8%, and most of the demand comes from consumer electronics; on the other hand, it will take at least ten billion yuan of investment to make chips, and it may take one to two years for a wafer factory to reach its design level. At present, the tight supply of chips makes it attractive. At that time, it may face the situation that demand does not exist, in addition, it will also face problems such as competition.” Xu Daquan said.
What is the meaning of “core matter”?
The booming new energy vehicle market in China is growing faster than expected, and the demand for chips is growing rapidly. It turns out that there are about 500 or 600 chips in a fuel vehicle. At present, there are 11 types of chips in the vehicle application, including power chip, main chip, driver chip, sensor chip, image processing chip, etc. There are about 1600 models. With the development of automatic driving technology, it will increase in the future.
However, it should be noted that the automotive chip industry has high technical barriers, large capacity investment, and long payback period. In addition, domestic chip companies started late in the automotive field, and the technology accumulation time is not long. China’s automotive chips are heavily dependent on imports. Zeng Qinghong, Chairman of GAC Group, said publicly that China’s auto chip self-sufficiency rate was less than 10%, and the localization rate was only 5%, and the supply was highly dependent on foreign countries.
In the face of chip shortage, in order to minimize the negative impact, many car enterprises have taken measures such as temporary chip replacement, vehicle reduction and delivery. However, in order to master more initiative, more and more OEMs are going to “make cores”. At present, there are three main forms: first, the new car making forces represented by Tesla, Weilai and Xiaopeng choose to develop their own chips to try to master the leading power of chip technology and supply; Second, car enterprises and chip suppliers jointly build factories or establish strategic partnerships to jointly carry out chip research and development. For example, CARIAD, a software company owned by Volkswagen Group, and Horizon, a chip manufacturer, set up a joint venture to develop high-level autonomous driving technology; Third, equity investment in existing chip enterprises. For example, GAC Group has invested in Guangdong Semiconductor for two consecutive rounds, and SAIC and Great Wall have entered the chip field through strategic investment.
However, there is a big challenge for auto enterprises to choose self-developed chips. On the one hand, we should compete with professional chip design companies for R&D capabilities; On the other hand, the chip R&D investment is huge. If the chip is only supplied to its own auto enterprises, it cannot form a scale and it is difficult to recover the cost. Therefore, it is a better choice to cooperate with chip design companies for differentiated customization.
“Bosch also produces chips. In terms of the raw materials of wafers, we are looking for domestic partners. From the perspective of procurement, although some production lines can be produced in small quantities at the vehicle gauge level, we have not seen suppliers who can fully meet the demand at the vehicle gauge level and can produce in large quantities.” Xu Daquan said that from the perspective of supply chain, he hoped that more local chip suppliers could provide chips within 2-3 years.
In addition, although the lack of core leads to cost increase and delivery delay, nearly half of Bosch’s projects in the next five years are related to “core” and intelligence. It is understood that 47% of the businesses of Bosch in the next five years this year are related to the “core”.
Post time: Nov-19-2022