Exclusive first-line|The truth about the 80% drop in MCU prices, is the market turning point?
MCU plummeted by 80%
This year's semiconductor chip market is out of stock and price increases are the main theme, and among them, chip roasting is mentioned. Among the masses of semiconductor devices, MCUs are the most popular among speculators, and news that prices have soared ten or even a hundred times are frequently exposed, allowing many speculators to make a lot of money. But recently the MCU market has undergone a 180-degree turn, with a large number of middlemen selling goods, and some MCU prices have fallen as much as 80%. Has the market ushered in an inflection point?

In order to investigate the most real market situation, the reporter of the electronic enthusiast network lasted for nearly a month, through communication with a number of MCU manufacturers, and finally grasped the most front-line news of the current MCU market. Let's follow the footsteps of the editor and walk into this treacherous MCU market.

The price plummets, and the MCU market enters an inflection point?

As early as June of this year, news of some manufacturers selling goods in the MCU market has been reported. For this reason, the editor also published a report "You are arranging goods crazy, he is quietly shipping, and the MCU market is performing Sun Tzu's Art of War" report. , To explain the MCU market at that time. But at that time, it may only be the personal behavior of individual hoarders, and the general situation of the market has not yet formed.

In July, the MCU market began to show signs of weakness. Some insiders revealed that MCU shipments were increasing significantly and prices continued to fall, but the prices of some models were still high.

Until September, market conditions changed rapidly, and many speculators screamed "GD’s MCUs are plummeting." The major IC trading groups were flooded with massive demand for chip shipments in a flash, and many middlemen were competing to lower their prices. Just ask to get rid of it immediately.

For example, ST's STM32F103C8T6 is about 6 yuan under normal conditions, and the highest rises to 65 yuan. The price in mid-June is 55 yuan, and the market price in September is about 50 yuan; NXP's automotive MCU, FS32K144HAT0MLHT, is about 20 yuan under normal conditions, with the highest market rise. To 585 yuan, the quotation was 500 yuan in mid-June, and the market quotation in September was 170 yuan, a drop of 80%.

In response to this situation, Lin Jinhai, product marketing manager of Arteli Technology, said that recently market end customer demand has been weak and MCU production capacity has increased. The increase in stockholders’ shipments has led to a certain drop in the original higher prices. .

However, we have not seen a clear signal entering an inflection point. 8bit and low-end 32-bit MCUs are mainly in the consumer market, and the impact is relatively large. The full range of Arteli products adopts 55nm advanced technology and is positioned towards mid-to-high-end MCUs. Orders The volume is still increasing, and the delivery volume is gradually increasing. Arteli will proceed in accordance with the established market strategy and supply plan.

Peng Yixing, product manager of Wuhan AutoChips, said that the current supply of MCUs fluctuates greatly, from good to bad. Recently, consumer MCUs have indeed eased, but automotive MCUs are still out of stock, and the price of the trade market The decline also has the effect of the government's crackdown on the phenomenon of roasted seeds and nuts, but it does not mean that the supply side has been completely alleviated.

Of course, the supply of MCUs in the market is indeed increasing, but Peng Yixing believes that it is mainly concentrated in the consumer market. Automotive MCUs have not changed significantly and are still in a tight environment. And due to the rapid growth of market demand and customer orders, AutoChips is also striving for production capacity.

Obviously, there is indeed a surge in MCU shipments in the current market, causing market prices to fall, mainly because of the increase in upstream supply and weak demand. But at the same time, automotive MCUs are still seriously out of stock, so you will find that many automakers still halt work and reduce production due to out of stock.

Window period of domestic MCU

It is worth noting that the MCU roasted products in the market not only include foreign brands such as ST and NXP, but also domestic products such as GD. Although the behavior of roasted seeds and nuts is not recommended, from the side view, this is also a sign that domestic MCUs are recognized.

In recent years, with the epidemic and well-known reasons, the supply chain has become completely out of balance. Many overseas MCU manufacturers only give priority to support European, American and Japanese customers when they are out of stock, leaving domestic customers, especially self-owned brand car manufacturers, in an unusually passive situation.

However, this has also strengthened the determination of domestic customers and OEMs to localize. This year, the domestic replacement of major OEMs and tier1 MCUs has accelerated significantly.

Lin Jinhai mentioned that benefiting from the lack of stock in the MCU market and Arteli's high-reliability quality and advance market layout, this year's performance has achieved strong growth, which is expected to increase more than 4 times over last year.

He also mentioned that domestic substitution is a phased process, and the Sino-US trade war and this wave of shortages have accelerated the process of substitution. At present, domestically-made MCUs have gradually realized import substitution in low-end and middle-end fields, such as consumer electronics, industrial control and other application markets. However, the mid-to-high-end market is basically dominated by large foreign manufacturers. For example, in terms of automotive-grade MCUs, only a few domestic manufacturers have products that can truly enter the market and there is huge room for substitution.

Astra’s full range of products use 55nm advanced technology and ARM® Cortex®-M4 high-performance or M0+ low-power cores, mainly based on general-purpose MCUs with high clock speed, large memory, high reliability and high compatibility, and are used in consumer In the fields of, industrial control, automotive and medical, there are currently 8 series of nearly 200 models.

Peng Yixing stated that AutoChips, as a leading domestic automotive MCU chip manufacturer, has already mass-produced two generations of MCU products that have been mass-produced and shipped in almost all mainstream OEMs, and the product quality has been fully verified by the market.

At the same time, AutoChips's new generation of MCU product AC784x will be officially launched. This product will become the first domestic MCU to pass ISO26262 functional safety certification, filling the gap in the domestic MCU in the field of functional safety, and assisting car manufacturers and tier1 to achieve domestic production of more body safety components change.

However, with the rapid growth of market demand in the first half of the year and the continuous shortage of MCUs, many customers fell into panic.

Regarding this phenomenon, Peng Yixing said that AutoChips is constantly strengthening communication with OEMs and Tier1, grasping more accurate market demand information, ensuring that limited resources can be delivered to the terminal more effectively, and doing its best to prevent all kinds of roasting.

The strong market demand, coupled with the imbalance of the supply chain, has ushered in a rare window period for domestic MCU manufacturers. At the same time, in order to prevent the market from overheating and affecting the future, the manufacturers have also strengthened the management of the supply chain to provide downstream customers as much as possible. Reasonable demand, avoid the phenomenon of hoarding and roasting as much as possible.

The hidden worries of the MCU market

Not long ago, the country has cracked down on the phenomenon of roasted seeds in the automotive chip market, which has also eased the current situation of roasted seeds in the MCU market to a certain extent. However, as middlemen continue to sell goods, it will also have a certain impact on the market. In other words, when MCU products continue to be released, downstream customers' orders for upstream MCUs may also decrease.

However, Peng Yixing said that due to the relationship between supply and demand, the shortage of automotive-grade MCUs will not be greatly alleviated in the short term. With the booming new energy vehicle market and the increasing demand for localization, the demand for domestically-made automotive-grade MCUs will It is rising steadily, and AutoChips will not have the problem of digesting inventory for a relatively long period of time in the future.

Lin Jinhai also said that it is not yet time to release the inventory, do a good job in the real needs of end customers and production management, rationally arrange production plans, and sign long-term orders with long-term partners.

It is worth noting that many manufacturers have indicated that the shortage of MCU market will be alleviated in 2022. At the same time, according to the SEMI report, global semiconductor manufacturers are expected to build 29 high-capacity wafer fabs before 2022, which is expected to bring 2.6 million wafers per month to the world.

Lin Jinhai believes that it will take about two years for the fab to expand. The estimated wafer capacity will still be fully loaded by the end of next year. The effect of wafer expansion will not be reflected until 2023 at the earliest. Whether there will be overcapacity, the main factor is still From whether the market demand continues to be weak.

Peng Yixing also said that from the information currently held by AutoChips, the consumer MCU market is expected to have a major relief in 2022, but the automotive MCU market will not have a certain relief until at least 2023. However, in terms of demand, according to research conducted by IC insights and many other authoritative organizations, the global MCU market will continue to grow rapidly in the next 10 years. The new fab is just to support the continuous and rapid growth of the MCU market and will not cause market impact. .

Although there is no consensus on whether there will be oversupply in the MCU market in the future, it is certain that the dividends left to domestic MCU manufacturers may end in the second half of 2022. When the supply chain resumes, some customers who choose to use domestic MCU products may reinvest in the arms of major manufacturers such as ST and NXP.

In response to this possible situation, most domestic manufacturers are more optimistic. Peng Yixing believes that after this round of shortages, domestic customers have experienced that foreign MCU manufacturers are unreliable. Only domestic products can save domestic products. Domestic MCUs, especially the leading manufacturers of the head, have been fully proven after several years of market inspections. With its product quality and R&D strength, coupled with the overall auto market and national policies to vigorously promote localization, the share of domestically-made MCUs will undoubtedly increase in the future.

Astra has put forward a more specific plan. Lin Jinhai revealed that from the beginning, it will select high-quality customers who are highly compatible with Astra's products and can cooperate for a long time in the future. Whether or not to switch back to the original brand of a major manufacturer depends on various factors such as the degree of compatibility between the demand for the terminal product and the MCU, and whether the quality, stability and supply are guaranteed.

In recent years, the quality and stability of domestic MCUs have been greatly improved, and many products are not inferior to foreign brands. If the MCU manufacturer's product is barely replaced because it is out of stock, the viscosity is low, and there is a greater chance of replacing it. In order to deal with it, in addition to finding suitable customers, it is also necessary to improve the retention rate of customers by enhancing the competitiveness of products and doing a good job in the construction of products, software and ecological environment.

summary

Entering the second half of the year, the MCU market took a sharp turn, and product prices plunged. However, after entering the market, it was found that it was mainly due to weak market demand and continuous supply from the upstream. The current market price is still higher than normal, and there is no turning point in the market. According to the general consensus of enterprises, the shortage of consumer MCUs will be alleviated in 2022, while the automotive-grade MCUs will need to be until 2023. At that time, the supply chain will be restored and major foreign companies will return. At that time, the challenge to domestic MCUs officially kicked off.