"I think we've gotten through the worst of it," said Kazunari Kumakura, global purchasing manager at Toyota Motor Corporation, in a recent public statement, and we're seeing signs of recovery, and we expect production to resume from December.
Over the past year, due to the epidemic and the global automotive chip shortage to the automotive industry to bring a huge impact, resulting in car companies stage production cuts and parts suppliers performance below expectations of the state, may soon be alleviated.
International rating agencies predict that global chip supply will start to improve across the board from mid-2022 as new chip capacity begins to come on stream. However, some degree of structural shortages will remain until mid-2023.
According to the monitoring data from the GGI Automotive Research Institute, the domestic market, for example, started in March this year, the number of new cars insured slipped slightly for several months, but from the data of September (1,658,500, up 7.28%), the downward trend shows signs of stopping.
However, as things stand now, the chip shortages at different OEMs will diverge in the next four quarters. Some manufacturers like Toyota (the main Tier1 Denso shareholding in Renesas) may be prioritized to get the supply guarantee, while car companies relying on the third-party Tier1, need to be queued up for "allocation".
Renesas Electronics, Japan's leading automotive chip maker, announced last Wednesday that it plans to increase its ability to supply key components for automotive chips (especially high-end MCUs) and related electronics by more than 50% by 2023.
"We have been increasing supply in the market, but demand has also been strong." Takeshi Kataoka, senior vice president at Renesas, said that the company will also increase capacity for low-end MCU products, which are currently experiencing severe shortages, by about 70 percent, primarily by expanding capacity at its internal factories. Meanwhile, high-end MCUs will leverage external third-party chip foundries.
However, according to Renesas Electronics' assessment, "it will take at least until 2022 to resolve the demand-supply imbalance. As for whether the specific time is the second half of 2022, or early 2023, it is not yet possible to make an accurate judgment."
Infineon is another important supplier of global automotive semiconductors, especially to the Volkswagen Group, a major customer, which began marketing its ID series of pure electric cars last year with more than 50 chips for different applications.
The head of the company disclosed that at present, an ordinary fuel car is about $ 450 worth of semiconductor components cost, from infotainment systems to a variety of different body control functions. The cost of a chip for a smart electric car is about $900-$1,000.
When it comes to the issue of structural demand, the person in charge believes that the short-term impact of the shortage of chips needed for electrification (e.g., power semiconductors) will be relatively smaller, while the impact will be greater when it comes to body and control chips, as these products are much more ****common with consumer electronics. "This also explains why this round of automotive production reduction wave , and did not have a significant impact on pure electric vehicle production."
Infineon completed the acquisition of Cypress Semiconductor last year, continuing to maintain its global share of the leading position in the field of power semiconductors and security controllers, and at the same time, with the size of the Cypress complement, jumped to become the world's No. 1 automotive semiconductor supplier.
Recently, the company announced plans to increase its original planned investment by 50% to about 2.4 billion euros next year, which will be mainly used for capacity expansion projects such as plant and equipment. Last month, its new factory in Austria officially put into operation, with an investment of about 1.6 billion euros. In accordance with the disclosed data, Infineon expects revenue to reach 11 billion euros this year, and will continue to grow by about 15% next year.
Positive factors affecting the supply of subsequent capacity from Intel and Samsung.
Intel announced this year that in the next ten years in Europe will invest 80 billion euros to open the automotive chip expansion program, and seek to provide OEM business for the automotive industry. According to the plan, Intel sees the automotive industry as a key strategic focus.
The company's CEO, Pat Kissinger, said that by 2030, the chip will account for 20% of the cost of the car, a figure compared to a five-fold doubling of the proportion of 4% in 2019. By 2030, the automotive chip market will double in size to $115 billion.
And Samsung through the previous layout of the automotive cockpit and ADAS chip business, as well as for Tesla OEM FSD chip has tasted the sweet spot. The company is now developing a new automotive industry development plan to grow the chip foundry business in the automotive industry, and compete head-to-head with TSMC and Intel.
On October 7, Samsung confirmed to the public that it will put into production the 3-nanometer process in 2022, and start mass production of 2-nanometer chips from 2025, and is expected to reach about $37 billion in capital expenditures this year, and at present, Nvidia and Tesla are already partners.
In addition, Hyundai Motor disclosed last week that it plans to develop its own chips in order to reduce its heavy reliance on third-party chip suppliers. Currently, the company is in substantive cooperation talks with Korean foundries (possibly Samsung) and chip design companies.
"The worst of the chip shortage is over," said José Munoz, Hyundai's global chief operating officer (COO), due to massive investments by traditional chip giants like Samsung and Intel in expanding foundry capacity for the automotive industry.
And for the automotive chip industry, there's a wave of technology upgrades coming.
Industry specifications such as automotive grade and ISO26262 are the traditional barriers to entry for the automotive industry. Today, assisted/autonomous driving, connectivity, and software updates make the entire vehicle electronics system more complex and networked than ever before. Cybersecurity assessments are becoming a primary consideration in the design of automotive semiconductors.
Now that distributed ECU architectures across the vehicle are a thing of the past, the reduction in the number of ECUs and the onboarding of more integrated domain controllers, from domain controllers running multiple virtual machines simultaneously, to modular integration for sensor fusion, braking, steering, infotainment, telematics, and body control, along with iterative upgrades brought about by OTAs, have also introduced greater cybersecurity risk.
A standard called ISO 21434 (Road Vehicles - Cybersecurity Engineering) defines a code of practice for the development of cybersecurity engineering practices for all electronic systems, components, and software in automobiles, as well as for external connectivity. This standard was officially published on August 31st of this year.
Renesas Electronics has already announced this month that its automotive microcontroller (MCU) and SoC solutions will be fully compliant with the ISO/SAE 21434 standard specification from January 2022 onwards. Currently, the company's 16-bit RL78 and 32-bit RH850, as well as its R-Car SoC family, are targeted at the automotive industry.
According to public data, Europe, Japan and South Korea since July 2022, for the approval of new models, requiring vehicle companies to be equipped with hardware products certified by the Automotive Cybersecurity Management System (CSMS), for the automotive chip makers, it will be a new window of time, and the market threshold will be increasingly high.
"More and more new features, such as remote diagnostics, Internet services, in-vehicle payments, mobile apps, and heavily networked functions such as vehicle-road collaboration and vehicle-cloud interoperability, have increased the attack surface of vehicle security." Industry insiders believe that the next step will be for vehicle manufacturers and suppliers to ****together decide the balance between the level of security and cost, while meeting regulatory requirements.
NXP is the world's first automotive semiconductor supplier to be T?V S?D certified to the latest automotive cybersecurity standard, ISO/SAE 21434, which means that the next chips to meet the standard will have to take cybersecurity into account from the prototyping stage all the way to the end of the product lifecycle.
The fastest way for car companies and suppliers to do this now is to start with the ECU/domain controller and add both a hardware security module (HSM) as well as a secure software stack that prevents unauthorized access to in-vehicle communications and vehicle controls. Currently, several automotive chip makers such as Infineon, ST, Renesas, NXP, and others have corresponding product lines.
For example, Infineon recently launched the SLS37 V2X Hardware Security Module (HSM), a plug-and-play security solution for V2X, based on a highly secure, tamper-resistant microcontroller tailored to the security needs of V2X applications. From the current progress of the industry, smart gateway and vehicle and road cloud related hardware will be the first to become the main force of the cybersecurity segmentation track.
The G9X smart gateway chip, for example, is a high-performance, automotive-grade chip designed for next-generation in-vehicle core gateways. It adopts a dual-core, heterogeneous design, and is equipped with a complete and independent hardware information security module (HSM) that supports the national security standard to meet the requirements of high functional security levels and high reliability.
At the same time, this smart gateway chip provides support for secure authentication of the source of OTA firmware data, secure encryption of transmission, and secure local storage and integrity verification. In addition, the HSM encryption module includes an 800MHz processor to support a wide range of future security service software.