Industry News

Up to 90% plunge! Many Electronic Component prices "avalanche", the business cycle has come to an end

Update time : 2022-08-16 18:00:09

In a short period of time, there are even Electronic Components from 200 yuan to 20 yuan, the decline is really amazing. Since this year, although the chip shortage problem is better than last year, but some areas of chip supply is still tight, in view of the new changes in the chip market, some enterprises continue to expand capacity, and some enterprises are transformed to a new track. What's the knock-on effect? Since the first half of the year, the consumer electronics market demand continued to weaken, Samsung, Dell, LG and other major manufacturers have cut orders. On the other hand, the mismatch between supply and demand makes the supply of chips in automotive, industrial automation, AI big data and other fields tight. According to the latest data, cumulative production cuts by global car companies are expected to climb to 3,829,400 units by the end of this year due to the chip shortage.
As the supply of chips exceeds the supply, many chipmakers have begun to significantly increase production to avoid another "chip shortage". But the rush to ramp up chip production comes at a time when consumers are cutting back on electronics because of the risk of a global recession. At a time when global chipmakers are ramping up production, chip inventories are rising, with the inventory surplus of some 2,350 listed chipmaking companies worldwide hitting a 10-year record, according to industry insiders. In addition, Korea, a global semiconductor industry leader, recorded its largest chip inventory in six years in June this year, surging 79.8 percent from a year earlier. In addition, the price of consumer electronics control chips is also falling, from a high of around 100 yuan to a double-digit price. In some lighting products will be used to drive and light chip, also began to decline this year, industry practitioners pointed out: "the price of light chip will be 20 to 30 percent year-on-year drop, and the price of the driver chip will be 40 percent drop, the fall of a larger range." According to incomplete statistics, from 2020 to 2024, a total of 25 8-inch and 60 12-inch fabs were built, with a total investment of nearly 1 trillion yuan. That would increase global 8-inch wafer capacity by nearly 20% and 12-inch capacity by nearly 50%.
Global semiconductor revenues are expected to be $639.2 billion in 2022, down $36.7 billion from the previous quarter's forecast, as economic conditions will continue to deteriorate throughout this year. From a business perspective, inventories are recovering rapidly, delivery times are starting to shorten and prices are weakening. Semiconductor market is entering a downward cycle industry, while the consumption will be slow, but continuous cloud infrastructure investment will make the income from the data center market semiconductor be toughness for a long time, with the increase of the semiconductor content of each car, the car electronics field in the next three years will continue to achieve double-digit growth.
Corresponding to capacity is the continuous growth of inventory level, according to Nikkei data, the world's nearly 2,350 chip-related listed manufacturing companies in the first quarter of 2022 inventory amount, compared with the end of 2021, a surge of about $97 billion, the inventory surplus and increment have hit a 10-year high. Similarly, today, WSTS and other sources also confirmed that the global semiconductor market fell into a rare downturn in June, marking the end of the current super boom cycle, the 17th cycle volatility in history has officially arrived. From another perspective, in recent years, China's enterprise investment to chip industry is increasing year by year. Data show that up to now, China's chip related enterprises reached more than 416,000; From January to July 2022, 68,000 new enterprises were registered, with an average monthly growth rate of 41.6 percent. In terms of establishment time, 26.8 percent of chip-related companies were established within one year. The industry gradually enters the competition white-hot stage.

Previous : Average delivery time for power management chips lengthened to 32 weeks in July against the trend

Next : Inventory remaining is at a 10-year high, and some chips have suffered an unprecedented price slump.

How to Identify Legitimate Sellers When Purchasing Electronic Components Online？

Dec .31.2024

Purchasing electronic components online is different from buying clothes online. One needs to understand various aspects. When shopping online for electronic components, one must have a basic knowledge of electronic components and know how to distinguish

Development Directions and Innovation Trends of the Electronic Components Market in 2025

Dec .31.2024

With the continuous progress of science and technology and the development of the global economy, the electronic components industry has shown a rapid development trend in recent years. From consumer electronics to industrial automation, from automotive e

Resistance Thermometer Temperature Sensors

Dec .31.2024

A resistance thermometer is a common temperature sensor that measures temperature by utilizing the property that the resistance of materials changes with temperature. Resistance thermometers are widely used in various fields, including industrial control,

Say Goodbye to Lag! Three Ways to Speed Up WiFi

Dec .31.2024

Don't worry. By learning the following three methods, your WiFi experience can be greatly improved! Let's improve the home WiFi signal from three aspects: transmission power, wireless channels, and location with the agency of Cirrus Logic. Say goodbye to

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