Industry News

Fitch: global chip manufacturers may face continuous "turbulence"

Update time : 2022-08-12 10:00:20

Fitch Ratings said that under the situation of geopolitical instability and monetary policy intervention, global semiconductor manufacturers are facing supply chain reconfiguration, and the fluctuations in income and cash flow will intensify. Due to the solid demand of data centers and the serious shortage of automotive chips, more chip manufacturers in non consumer markets will continue to face supply constraints in 2023. However, weak sales of consumer electronics, PCs and smartphones are putting pressure on chip manufacturers in the consumer market, leading to a reduction in their capital expenditure.
The regionalization process of the semiconductor manufacturing industry in Europe and America will initially reduce the production efficiency. Compared with the continuous growth enjoyed by the industry in the past few decades, it is expected that this transformation will lead to continuous fluctuations in income and cash flow in the short term.
In the near term, chip manufacturers may make excessive investment in production capacity during the economic recession. The slowdown of global economic growth and the increase of production capacity may be beneficial to the semiconductor supply and demand environment in 2023, and the overcapacity will continue until 2024-2025. Chip manufacturers can flexibly reduce capital expenditure to meet lower than expected demand, but there is a risk of supply shortage when the economy recovers, because factories need a lot of time to prepare for production.
Recently, there has been an extremely serious excess demand in semiconductor sales, which is due to the reopening after the epidemic, the recovery of consumption, the superposition of supply chain constraints, resulting in the depletion of inventory, and the fear of supply has further stimulated the manufacturers' demand for defensive inventory. In response, chip manufacturers are actively investing to increase production capacity based on long-term capital expenditure strategic plans.
On the positive side, Fitch believes that, driven by technological (such as 5g deployment and artificial intelligence) innovation and growing chip demand, the semiconductor industry is still expected to achieve long-term average single digit growth, which will support the income growth and long-term credit situation of chip manufacturers, and should limit the extent and duration of more typical cyclical recession related to inventory correction.

Previous : In the semiconductor industry in 2022, the giants are making a big bet on expanding production

Next : Lingsi technology completed the pre-A round of financing for self-developed chip R &D

How many chips does a car need?

Sep .19.2024

Automotive chips can be divided into four types according to their functions: control (MCU and AI chips), power, sensors, and others (such as memory). The market is monopolized by international giants. The automotive chips people often talk about refer to

Position and Function of Main Automotive Sensors

Sep .18.2024

The function of the air flow sensor is to convert the amount of air inhaled into the engine into an electrical signal and provide it to the electronic control unit (ECU). It is the main basis for determining the basic fuel injection volume. Vane type: The

Chip: The increasingly intelligent electronic brain

Sep .14.2024

In this era of rapid technological development, we often marvel at how mobile phones can run various application software smoothly, how online classes can be free of lag and achieve zero latency, and how the functions of electronic devices are becoming mo

LDA100 Optocoupler: Outstanding Performance, Wide Applications

Sep .13.2024

In terms of characteristics, LDA100 is outstanding. It offers AC and DC input versions for optional selection, enabling it to work stably in different power supply environments. The small 6-pin DIP package not only saves space but also facilitates install

About Us

About Us What we do Quality People

Products

CHIP/IC Active devices Passive device Components OTHER

China electronic components supplier----Wah Luen Shing Electronic.----www.wlschip.com

Leave a message