The global “chip shortage” is intensifying, can the US “chip summit” be rescued?

With the deepening of the human information technology revolution and the increasing popularity of new technology applications, the application of semiconductor chips has become increasingly widespread, with its presence in various fields, equipment, products, weapons, applications and terminals from military to civilian use. However, affected by multiple factors, the global chip industry is currently falling into a situation of insufficient supply, and many companies, production lines and supply chains related to semiconductor chips are also severely affected. Recently, some manufacturers of popular Electronic products such as smart phones, game consoles, and tablet computers have fallen into a “chip shortage”. For this reason, in the early morning of April 13, Beijing time, the White House hosted the “Semiconductor and Supply Chain Resilience” summit.

It is reported that a total of 19 presidents of related industry companies participated in the summit, including major chip suppliers TSMC, Samsung, Intel, Micron, Medtronic, Dell, Hewlett-Packard, and General Motors and Ford Motors, which were hit hard by chip shortages. In fact, in February of this year, US President Biden ordered several federal agencies to take action to resolve the chip crisis and seek huge amounts of funds to promote legislation for the US chip manufacturing industry, but with little success. At present, the global “core shortage” situation is severe and needs to be solved urgently. Can the US government offer a cure for the market? Arouse market attention.

The global automotive industry has a huge chip gap

On the issue of “core shortage”, global car companies may be the most anxious at present. At the beginning of last year, the global new crown epidemic broke out and the shutdown of factories caused supply shortages. In the home office, the demand for personal computers, game consoles and other products has increased sharply, the supply has decreased and the demand has expanded, and the chip production capacity will naturally be tight. Under the situation of insufficient supply, chip manufacturers generally choose to tilt limited production to the consumer electronics field, and automakers whose sales have fallen sharply in the early stages of the epidemic have naturally become the “most downstream.” However, as the global auto market began to recover steadily in the second half of last year and the development of intelligent auto industry and new energy in various countries, the auto chip market supply recovered rapidly. The negative impact of the epidemic on the supply chain and the underestimation of the rebound in chip demand by automakers have caused supply cuts to resonate with increased demand, resulting in a huge chip gap.

Since the auto industry was exposed to “core shortage” at the end of last year, many auto companies around the world have fallen into a situation of reducing or discontinuing production, and the problem of core shortage is now becoming more and more serious. In December last year, the Volkswagen Group issued a chip shortage alert. Due to the shortage of chips, the supply of corresponding parts was cut off, and the Volkswagen Group reduced production in North America, Europe and China. Subsequently, Fiat Chrysler, Nissan, Daimler, Subaru and many other car companies have announced that some factories have been forced to suspend production due to the shortage of semiconductor chips. In April, General Motors of the United States announced that it would suspend production or extend the suspension period for several plants in North America. Among them, GM’s three plants in Tennessee, Michigan and Mexico will be temporarily closed for one to two weeks. The plant shutdown period in Kansas and Ontario, Canada will be extended to May 10.

“Lack of core” has become the biggest risk facing car companies. More importantly, due to factors such as a long chip production cycle and difficulty in increasing chip production capacity, statistical experts from the American Semiconductor Industry Association said that it is estimated that it will take about 6 months to obtain new chip orders, and it may take the same or more to complete the order. A long time. The Auto Innovation Alliance, a US auto industry organization, warned that a shortage of semiconductors may cause auto companies to suspend production in the next six months. According to the latest forecast by the market research agency Escin Huamai, global auto production in the first quarter of 2021 is expected to fall by about 10% compared with the same period in 2019, and the production will be reduced by nearly 1 million vehicles. The annual global auto industry sales will be A reduction of 60 billion U.S. dollars. Previously, the American Bernstein Research Company predicted that in 2021, the global automotive chip shortage will reduce the output of 4.5 million vehicles, equivalent to about 5% of the global annual output of automobiles.

The US “sword refers to” the dominance of the semiconductor industry

To solve this problem, the White House hosted the “Semiconductor and Supply Chain Resilience” summit this week. The three major U.S. automakers GM, Ford and Chrysler attended the summit, as well as executives from semiconductor companies such as GF, NXP and TSMC. In fact, after taking office, Biden has approved a series of support plans and incentive measures for US chip companies.

On March 31, when Biden announced its “U.S. Jobs Plan” of more than two trillion US dollars, he also proposed that the US Congress allocate 50 billion US dollars to subsidize the manufacturing of the US chip industry and the research and development of cutting-edge chips, and proposed A new office will be set up under the U.S. Department of Commerce to support U.S. companies in the production of key products. In addition, Biden also proposed to allocate a further US$50 billion in the future to strengthen the US’s semiconductor chip manufacturing and research capabilities. Biden emphasized at the summit that his chip support plan has received bipartisan support. At the same time, Biden read out letters from 23 senators and 42 members of the House of Representatives, all of whom support his proposed $50 billion semiconductor manufacturing. And research proposals.

After the meeting, Intel CEO Pat Gelsinger said that the company is beginning to negotiate the production of chips for automakers to help alleviate the shortage of chips that caused auto factories to stop production. Last month, Intel announced that it would spend $20 billion to build two new chip factories in Ocotillo, Arizona. At that time, Intel mentioned that some companies focus on semiconductor design, but need a company to actually produce chips, and Intel will act as their “founder” or manufacturing partner. Gelsinger also mentioned that he hopes that American companies will account for one-third of the semiconductors produced in the United States. He said: “I believe our goal should be that American companies should place one third of semiconductor production in the United States.”

However, it is worth noting that due to the continuous decline in the market share of the US chip industry, in terms of huge market demand, only the increase of output by local US companies is tantamount to a drop in the bucket. According to data from the International Semiconductor Equipment and Materials Association, the United States’ share of the global integrated circuit market has fallen from 24% in 2000 to 12% last year, while products from Asian economies such as Taiwan, South Korea, and Mainland China account for 61% of the world’s total. Therefore, South Korean media believe that the United States used the summit to “listen to opinions on how to solve the problem of global semiconductor shortage”, but the deeper purpose is to accelerate the rise of the US semiconductor industry. Park Jae-geun, president of the Korea Semiconductor and Display Technology Association, said that with this meeting as an opportunity, the US government is likely to pressure global semiconductor companies to increase the size of their factories in the United States and try to control the global semiconductor supply network. .

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