The "sun rain" of the semiconductor industry, while the chip is in short supply, the price has plummeted
Chip shortages have plagued the world and China's new energy vehicles and other chip-related industries for two years. However, some chip prices have plummeted by 90% recently, chip inventories have increased, and delivery times have been shortened. Some core-related companies just wanted to take a breather, but the chips needed by automakers and industrial equipment makers are still tight. The global chip industry has seen a rare situation of "raining out of the sun" where product shortages and price slumps coexist.
It is understood that the STMicroelectronics L9369-TR chip, as the core component of the electronic control system, is one of the most in-demand chip products in 2021. In the third and fourth quarters of last year, the quotation of this chip once rose by 100 times, and the market quotation was as high as 3,500 yuan. In 2022, it will fall from a high to 671 yuan, a price reduction of more than 80%.
Liu Xingliang, a member of the Information and Communication Economics Expert Committee of the Ministry of Industry and Information Technology, quoted public data and said that in the field of consumer electronics, especially in many major types of chips such as panel chips, communication chips, and analog chips, the price drop was not small. Among them, most of the prices have dropped by more than 20% in the past two months, and some chips have dropped by more than 80%.
A 2020 report by the Global Semiconductor Alliance suggests that components of a semiconductor may need to travel more than 50,000 kilometers and cross more than 70 international borders before a semiconductor device reaches the end consumer. George Calhoun, director of the Hanlon Center for Financial Systems in Hoboken, New Jersey, USA, said: “It is not appropriate to speak of supply chain alone, because it is a very complex global Some of the nodes are critical.” One key vulnerable region is the Netherlands, where ASML is a lithography technology leader and the world’s only producer of extreme ultraviolet (EUV) lithography machines. Another key region is Taiwan, China, where 3 companies produce more than 90% of the world's most advanced (5nm and 7nm) semiconductors. However, a 2021 report from the Semiconductor Industry Association (SIA) says globalization itself is not a bad thing. The association estimates that it will take 10 years and trillions of dollars for the United States to achieve a self-sufficient local semiconductor supply chain, and the price of semiconductors will increase by 65%.
Historically, the semiconductor industry has experienced frequent cyclical demand fluctuations, but this time the changes are really complicated. Many researchers are currently scratching their heads: what kind of situation will the weakness of semiconductors this time be. At present, in the fields of memory chips, personal computer processors and other chips, there is a rapid oversupply, but at the same time, in the fields of automotive chips and industrial chips, semiconductor manufacturers have not been able to satisfy customers and establish a stable chip supply.
The sharp weakness this time around has prompted several U.S. semiconductor giants to cut billions of dollars in capital spending plans. Dan Hutcheson, CEO of VLSI Research, a semiconductor industry research firm, has been studying the chip industry since the 1980s and is a veteran semiconductor watcher. Hutcheson said that the sharp downturn in the semiconductor market this time, and the combined forces of various contradictions on the market, are unprecedented.
The pandemic turned it into a catastrophic storm at a time when semiconductors began to outstrip supply. The complex global logistics of sourcing raw materials to shipping components and distributing finished chips to customers is hitting every part of the supply ecosystem. In January 2022, the U.S. Department of Commerce released a report that surveyed more than 150 companies in the semiconductor supply chain, including nearly every major chipmaker and customer, such as Ford, Google, and Verizon. The report pointed out that the median inventory of semiconductor products fell from 40 days in 2019 to less than 5 days in 2021, leaving these companies in a vulnerable state.
The current semiconductor industry is very different from the 1990s. At that time, one company produced specific products such as hard disks and memory, and several companies in one country could support the product supply of the entire world. Now, semiconductor companies such as mainland China, Taiwan, the United States, and South Korea occupy important positions, while Europe and Japan are relatively backward. In terms of products, it is no longer a single product such as hard disks. Chips are deeply involved in various fields such as digitization, green manufacturing, dual carbon, and information security.
China is the world's largest semiconductor chip consumer market. If the products are not sold to China, the cost problem will immediately become prominent, and it will be very difficult to maintain the update of semiconductor technology. If China makes a new layout in its economic strategy and further promotes technological innovation, it will definitely be able to avoid the end of Japan in the end.