Auto Chip Giants, A Strong Attack

At present, with the increasingly sluggish demand for mobile phones, PCs and other products in the global consumer market, industry manufacturers are worrying about a large amount of chip inventory that is difficult to digest.

The prosperity of automotive chips is in stark contrast to the sharp decline of other tracks. The automotive market, which is developing towards electrification and intelligence, is emerging with a huge demand for chips.

In the future, the development of automobile intelligence and electrification will continue to drive the continuous improvement of automobile semiconductor content and overall market size. Under this situation, Infineon, Texas Instruments, Renesas Electronics, NXP, STMicroelectronics, and ON Semiconductor and other traditional automotive chip manufacturers have continued to expand their production.

Infineon: the largest single investment in history

Infineon's latest financial report shows that the first quarter of fiscal year 2023 has achieved growth in profit and revenue, and strong sales of automotive and industrial chips have offset weak demand for smartphones, computers and data centers.

With the improvement of automobile intelligence and electrification, the demand for chips has changed significantly. Half of Infineon's business in automotive chips is power semiconductors, and the others include MCUs, storage and perception chips.

Texas Instruments: Vigorously expanding production of 12-inch fabs

Texas Instruments' automotive business revenue will reach US$5 billion in 2022. Among them, Texas Instruments has an absolute overwhelming advantage in the field of power management ICs, with a market share estimated to exceed 60%. Electric vehicles have a strong demand for power management ICs, driving the rapid growth of Texas Instruments' automotive business. At the same time, tight production capacity has also accelerated the pace of expansion of Texas Instruments.

Renesas Electronics: Restart 12-inch fab

Renesas Electronics is also considering expanding production.

Not long ago, Renesas Electronics CEO Shibata Yingli said in an interview that building and operating a new factory in Japan faces challenges, such as high water and electricity costs, frequent earthquakes, and limited talent, but Renesas will still expand production, and Renesas will consider Expand chip production capacity outside Japan to reduce the risk of future supply chain disruptions to automakers and other key customers.

STMicroelectronics: Continue to be optimistic about the automotive market

Benefiting from the strong demand in the automotive market, the financial report of the global power chip giant STMicroelectronics (ST) also looks optimistic.

According to the financial report, STMicroelectronics will achieve revenue of US$16.3 billion in 2022, a year-on-year increase of 26.4%, and a gross profit margin of 47.3%. The growth momentum in the annual performance mainly comes from the automotive and industrial fields. Among them, the income of the ADG business unit where the automobile is located accounts for 37% of ST's total income, and the automobile business alone accounts for 23% of ST's income.

In the past, more than 80% of the global automotive chip supply was in the hands of international IDMs such as Infineon, NXP, Renesas Electronics, Texas Instruments, STMicroelectronics, and ON Semiconductor. As IDM manufacturers expand their own production capacity, the supply of their own automotive chips will be smoother, and automakers can get rid of the haze of chip shortage, but this will also put pressure on outsourced foundries that have recently increased their production capacity for automotive chips. With the entry of new players and the emergence of new business models, competition in the automotive chip industry has intensified, and challenges and opportunities coexist. As the life-saving straw of semiconductor companies, industry manufacturers are striving to win the growth baton of the auto market.