Written | Wu Xianzhi
Edit the | Wang Pan
On an ordinary afternoon last year, seven or eight men were huddled in the office of a first-tier supplier (also known as "Tier1" in the industry) of a car company, and the atmosphere was extremely tense.
"Mr. Huang, it's been 4 months, you haven't called me at all, and today you solved the problem in front of the original factory (chip factory) people." Zhang Xin is an automobile chip dealer, due to the overdue account age of customers, many times of communication without results, he pulled several managers of a chip manufacturer in China to "collect debts".
In order to alleviate the rapid fire that was constantly rising, he unbuttoned his collar, picked up the mineral water in his hand, and drank it, his eyes always staring at a middle-aged man opposite.
"Brother, it's not that we don't give, the customer doesn't pay, I'm not a printing press, how can I not change the money!" The middle-aged man's voice did not fall, seeing Zhang Xin's eyes straight, he hurriedly changed his mouth and said, "Allow me to think of a way to give me two more days?" ”
"You strangled me to death, we said financially, if the money does not arrive, this goods will definitely not be sent." Zhang Xin couldn't hold back and slapped a slap on the middle-aged man's desk. As we all know, last year's chip shortage, Zhang Xin's words directly angered the middle-aged man, "Several bosses of the original factory are also here, little brother, you don't want to ship the meaning is that you don't want to cooperate, right?" ”
Seeing that several managers from a US chip company around him were silent, Zhang Xin said lightly, "Cooperation or non-cooperation depends on whether you pay or not, and I really can't do anything if you don't pay."
From the second half of 2019, the global automotive chip gap continues to expand. As a first-class agent of a chip manufacturer in China, Zhang Xin told Photon Planet that the above quarrels are commonplace. "The most heinous thing is to take the acceptance bill, drag you for several months, and people will drag and deform."
An industry insider believes that the supply of automotive chips is almost impossible to improve before 2024, even if some chips have domestic substitutions, car companies and Tier1 will not purchase because of various considerations.
When Photon Planet asked a number of industrial chain people whether there was any other reason for the lack of cores in addition to the impact of the global epidemic, most of them believed that the price increase of chips was the result of the joint action of the entire industrial chain, and could not only be blamed on the hoarding traders or middlemen.
"If the middleman can stir up the price, then the whole industrial chain is too fragile." One insider said the problem was far more complex than expected.
Why is the "core" panicked?
The driver of the first round of chip price increases is actually car companies.
"When the epidemic broke out in 2019 and 2020, SAIC and FAW realized that there may be a shortage of chips, and some OEMs have stockpiled a batch of goods." Huang Lin is an electronic control engineer at an oem factory, and he does feel that the chip problem is increasingly constraining car companies.
When the outside world, or car companies are talking about the lack of cores, they actually ignore that the car machine chip has gone through a relatively complex process from manufacturing to car companies.
Huang Lin said, "Car companies in most cases can not see the chip itself, the so-called lack of core of car companies is actually mainly the lack of cores of electronic equipment first-tier suppliers, because the corresponding modules can not be delivered, resulting in the lack of cores of car companies." ”
According to him, the domestic automotive industry chain needs to go through at least four links to obtain a chip: chip manufacturers (such as Texas Instruments, Infineon, NVIDIA), first-level agents in China (the larger domestic ones are China Electric Port, Arrow), car suppliers (such as Bosch, Delphi, BorgWarner), and finally car companies.
Specifically, car companies first inform the first-tier supplier (Tier1), who goes to the market to find dealers who can meet the demand, "Under normal circumstances, Tier1 will tell us that there is a project here and ask if we can match." After bidding or docking to confirm the agent, the agent will further pass the demand to the original factory adaptation, and register.
After the original factory receives the order, it will send engineers to promote the project together with domestic distributors and Tier1. Among them, Tier1 plays the role of Party A, the chip factory is Party B, and the agent is mainly intermediary coordination. It should be pointed out that agents not only represent products, but also will be deeply involved in the revision, confirmation and mass production of the entire program when demand arises.
Due to the impact of intelligence and the epidemic, supply has been frustrated, demand is strong, the delicate balance between the original links has been broken, and the domestic automotive supply chain and overseas chip manufacturers have launched an intricate game.
We have seen that some domestic car companies and Tier1 try to solve the problem through short-term investment, mergers and acquisitions, or directly find chip companies to jointly develop, and even bypass chip factories' agents in China. For example, Tucson Future cooperated with Nvidia to develop an unmanned controller based on the latter's latest vehicle-grade AI chip.
However, Chen Xin believes that regular agents cannot be bypassed, for example, the United States Arrow is TI's exclusive agent in China, and like CLP Port, the coverage chip is relatively complete.
"Car companies or domestic Tier1 will never, and can not be docked to the original factory." He even mentioned that "it is rare to see domestic Tier1 or car companies can cooperate with chip factories for a long time, let alone develop it in the early stage." "In general, after the original factory designed it himself, he pushed a certain product to the car company, and the domestic main engine factory was required to adapt to its products."
The above-mentioned person explained that most chip manufacturers are European and American companies, and they will first satisfy existing customers. For example, the large Tier1 that has been supporting the BBA for many years can ask for the chip company and say "what kind of chip I want", the original factory will generally cooperate, and it will not work with the domestic Tier1.
Not only do domestic companies have no right to speak, but before 2020, they will even become a channel for many chip manufacturers to inventory. "Unless it has been produced for three or four years and there are already new replacements, it will be sold to domestic car companies such as Chang'an."
On the other hand, chips will be controlled by local laws and regulations, so they also need to have third-party and fourth-party participation to avoid problems and potential risks.
A former BYD engineer told Photonic Planet that at that time, a part was only produced by a foreign manufacturer, but when he proposed his intention to purchase, he was rejected by him. In the end, the company took a big detour and went through a series of complex processes such as Korean agents and domestic two-level agents before finally getting the product.
"A small part is 2,000 yuan, can you believe it?"
In addition to supply chain issues, the account period problems of domestic related enterprises also require several levels of apportionment between Tier1 and chip factories. "Chip factories cannot accept domestic account periods and acceptances, and on the other hand, most of the domestic Tier1 and car companies have at least 3 months (90 days) of account periods", which is also the busiest source of Zhang Xin's work.
"It may take 105 or 115 days to actually go through the full process of reconciliation, invoicing, and payment, and sometimes even ask you to take the acceptance draft." If there happens to be a 1-month bill of exchange, then even if you are lucky, if you are unlucky, a set of acceptances will go down, and 6 months will be gone. ”
Therefore, domestic chip agents also play a role in hedging the account period, resulting in agents having very strict discipline in capital turnover. "If the customer doesn't pay, I won't ship."
Engineer Huang Lin mentioned that if the demand is relatively high, in order to ensure that the payment progress is in line with expectations, the agent will not deliver all the chips at once, but after receiving the payment, with 20 chips as a unit, wholesale shipments.
Therefore, solving the chip problem cannot be achieved overnight, and the entire domestic supply system needs to start from research and development, materials, funds and other aspects to be solved.
Who is driving up the price?
When you understand the chip market situation, you will have a completely different understanding of the supply shortage in the past two years.
Automotive chips are a vague concept, which actually includes MCU, ASICs, computing power Socs, power semiconductors, sensors, storage and other chips with different uses. Several people from car companies, supply chains and agents confirmed to Photon Planet that the most urgent thing nowadays is the automotive MCU category (micro-control chips).
According to data from previous years, the automotive micro-control chip market accounts for about 40% of the total sales of MCUs in all industries, and most of the related companies come from overseas, including all-round giants such as Texas Instruments, and also includes infineon, which is competitive in some fields.
Obviously, the mismatch between supply and demand is a structural reason, but photon planet found in its communication with industry insiders that the entire supply chain link has more or less contributed to the price increase.
As mentioned earlier, automotive chips entering the domestic market need to go through at least four links, chip manufacturers - agents in China - suppliers - car companies. Any price adjustment in one link will raise the cost of the next link.
An insider said that in the face of soaring chip prices, manufacturers are relatively rational, and the price increase in this link in the past two years is not obvious. However, the epidemic continues, and the price increase of upstream raw materials has overwhelmed manufacturers. Recently, Infineon issued a notice letter to downstream distributors, saying that due to the shortage of supply in the market and the increase in upstream costs, it cannot afford to bear the cost of spillover, and the price increase will be a high probability event.
In terms of agents, due to the existence of agency agreements with the original factory, there are strict requirements on price and quantity, and they cannot rise or fall arbitrarily. According to the information provided by Zhang Xin and another chip agent, Ren Hua, they do not know how much demand there is from customers, let alone accurately grasp how much inventory and how big the gap is in Tier's hands.
Among them, Ren Hua mentioned that agents only know how much supply they represent the chip manufacturers and how much they can supply to the domestic market. On the contrary, Tier1 knows how many chips it needs to use to provide supply services to car companies, and how much it has in stock.
When Photon Planet asked a Tier2 (secondary supplier), it agreed with Ren Hua's statement. At the same time, he believes that the price increase is mainly the result of the price increase of the middleman, and has nothing to do with the supplier. According to a trader who did not want to disclose details, he also obtained the chip from other sources, but he refused to tell the photon planet how the "goods" in his hands were obtained.
Zhang Xin analyzed that the supply of chip traders comes from breaking the circulation channels that chips should have, in addition to chip factories, the other three links are either directly or indirectly promoting the lack of cores.
"Because everybody is driven by interests to have an idea. It mainly depends on whether there is someone to play with you and whether there is a channel to get the goods. Generally speaking, regular agents, traders, original manufacturers, customers (Tire1) are grasshoppers on a rope, which may be involved, and the lack of any piece of the industrial chain will have a chain reaction. ”
Another automotive engineer sorted out the following situations, which have certain reference value.
The first situation comes from Tier1's failure to pay on time leading to expectations, and the chip is pressed into the hands of agents. Some people have seen the market price soar, and at the same time, in order to release the risk, they have raised the price and sold it to other suppliers.
The second case is that Tier1 hoards goods in response to price increases, or deliberately falsely reports demand to agents. Zhang Xin's statement can confirm this speculation.
"It is true that in order to alleviate the chip problem, some suppliers found four or five agents to bid in the bidding process, and finally reported the same demand to everyone at the same time." However, he believes that unless the agent has a lot of goods before, it is difficult to see this situation. "Because the demand will eventually pass to the chip manufacturers, suddenly asking for such a large amount, the relevant companies will be alert."
The third situation is that some suppliers cannot fully meet the sudden increase in demand of car companies, in order to consolidate the cooperative relationship, or find other peers to adjust, or share layer by layer. Either way, it will push up the cost and exacerbate the shortage of the chip.
In addition, some traders (chip speculators) will go around asking for trust, looking for suppliers and agents to ask for goods, trying to sit on high prices and profits, which will also bring about price increases. A company supply chain person once told Photon Planet, "Customers are friends, sometimes, how much goods to want, which one to choose, how much to use, and finally can be solved on the wine table." ”
Even some agents who take formal channels sigh that there are indeed peers around them, and in 2020, they have earned tens of millions, or even hundreds of millions of dollars, by speculating chips. "Last month I ate a roadside stall with me, and this month I was invited to the villa, and to be honest I was still very red-eyed."
Circulation factors of chip shortages
An automotive engineer in Beijing said that many companies have cross-border car manufacturing, which has brought great pressure to car companies.
"Lei Jun built a car, dug people everywhere, and raised the cost of labor." Before showing that he wanted to take 10 billion to build a car, the quotation of the entire industrial chain went up. For example, before opening a mold, if the amount is large, the mold opening fee will not be charged, and now you want to take 10 billion to build a car, how to score me a 2 million mold opening fee, right? ”
The global auto industry has long been very mature, chains are interlocked, but as more and more companies build cross-border cars, the once calm lake surface has been stirred up. "The price of flour has risen, and so have the sellers of lime."
At the same time, the upstream supply chain continues to integrate, and several large enterprises have more say.
In the field of batteries, the pace of upstream and downstream expansion of the Ningde era has accelerated significantly, with the acquisition of lithium mines, investment, and even direct power exchange services and participation in car company financing. Car companies in the downstream are increasingly afraid of the emergence of a "Ning Wang" in the supply chain link that cannot be bypassed and cannot be done.
In the field of electronic control, BorgWarner has a great right to speak. Since 2015, the company has formed a relatively complete product line such as electric drive modules, battery heaters and cockpit thermal management products through mergers and acquisitions.
Because a considerable part of the auto parts come from industrial parts, there are also some companies that originally made industrial parts that crossed over to the automotive field, such as Molex (Moshi, USA), which has integrated connector modules in recent years.
In 2015, it acquired the industry's leading Remy motor, in 2017 it acquired Sevcon, a British manufacturer of new energy vehicle control devices and battery chargers, in 2019 it integrated two companies in the field of electric and hybrid, and a year later, it acquired Delphi for $3.3 billion to intervene in the field of autonomous driving and the Internet of Vehicles.
An industry insider concluded, "You will find that there are more and more car companies facing the consumer market, and there are fewer and fewer suppliers for car companies." "This is not only the trend of industrial development process, after all, intelligence expands the industry's demand for components, and then requires suppliers to have stronger integration capabilities." On the contrary, domestic related enterprises have always been in a state of individual breakthrough.
A former BYD employee told Photon Planet that not only is there a lack of chips in China, but many precision parts are also heavily dependent on imports, and even if there is a domestic substitution, its production process is still highly dependent on labor.
He said that when BYD wanted to localize a certain part of Bosch's mass production, Wang Chuanfu asked engineers to find a way to "study" it, but unfortunately the precision of the machine tool was not enough, and how to do it according to the mold was also a millimeter. So "pulled a group of us to polish the burrs by hand and calibrate the accuracy."
Even so, the yield rate is only 20%. "There is a slogan within BYD, called: Robots are machines that can't add people."
Specific to the field of chips, domestic substitution is also facing great difficulties. Zhang Xin, who stands on the side of the agent, and Huang Lin, an engineer who stands on the side of the car company, both believe that the chip cannot achieve domestic substitution in the short term.
First of all, due to safety reasons, car suppliers do not have the power to localize. "You tell me to use the domestic one is no problem, then there is a problem, who is responsible for the car companies, suppliers, and chip companies?" Huang Lin mentioned that the reason why foreign suppliers have a perfect responsibility system in addition to the high reliability of their own products.
Secondly, the existing national production capacity substitution field is quite limited, Zhang Xin believes that at present, all automotive chip products, may be the highest possibility of short-term replacement of electronic control chips, like Gigabit Innovation can also provide more reliable products.
Third, a chip needs to pass the vehicle specification certification, and it needs to go through a rigorous and demanding inspection to get the corresponding qualification. Long cycles, high risks and high costs hinder the pace of domestic enterprises. We have seen that some domestic companies have tried to bypass through mergers and acquisitions, such as Wingtech Technology's earlier merger and acquisition of Nexperia to obtain MCU chips, but it is far from quenching the thirst.
Finally, although the Tier1 giants such as Bosch and BorgWarner have joint ventures in China, their ability to integrate the industrial chain is significantly better than that of domestic supply chain enterprises, and they will not easily replace existing secondary suppliers.
Agent Ren Huawei We described a bid in which he personally participated.
At the end of last year, a certain level of suppliers found four or five chip agents from China, Europe, the United States and other chip agents to bid, the competition is quite fierce, the supplier knows that domestic competitors are embarrassing and useful, and released the wind to give priority to testing domestic products. Ren Hua heard the wind and immediately found his own technical staff of the chip company and pulled the suppliers together to dock the needs.
"I remember that it was the twenty-ninth day of the Waxing Moon, and I, the technicians, the suppliers, and the chip factory stayed up all night together. At the same time, another group of colleagues went to the supplier's headquarters to give them the annual meeting to hold the scene and contact their feelings, and finally grabbed the list. He mentioned that in terms of programs, processes and services, domestic enterprises do have a big gap with foreign enterprises.
Can be missing core, can not "lack of heart"
In order to cope with the problem of lack of cores, long-term investment by domestic enterprises is necessary, but in the short term, the problem can only be hedged through other means.
According to an insider of a northern car company, not only is the supply of chips tight, but there is also a large gap in other parts, and the management has to require the production lines of several of its models to start in order according to the supply chain situation, so that there is more time and space to allocate shortage modules.
Like the Great Wall Euler frequently broke out negative events, in fact, it reflects the shortcomings of the car company in the field of supply chain. Earlier, the "chip door" was a shortage of goods in the supply chain, the relevant personnel broke the can and broke the can, and then the black cat and white cat stopped production, and it was more likely that the Great Wall temporarily stopped receiving orders in order to adjust the production line.
Frankly speaking, from the cost point of view, the rising price of chips makes it difficult for models such as black and white cats for low-priced demand to return to the market.
Photon Planet has learned that in the face of the short-term inability to alleviate the lack of cores, some players in the industrial chain have begun to respond to growing demand with shoddy charging.
Some insiders have learned from a mainland auto parts market that some merchants are engaged in the recycling, refurbishment and sales of semiconductor products, including not only businesses that purchase waste products to refine precious metals, but also a group of businesses that specialize in purchasing waste car chips. It is understood that this part of the chip is known as the "disassembly chip" in the industry.
The above-mentioned person mentioned that the sales volume of related products is not lost to those chips from normal channels, which not only fills the gap, but also meets the market demand. The only problem is, "Because most of them are chips from four or five years ago, it may be very obvious after installation, but because of the seriousness of the car regulations, the reliability is still no problem." ”
At the same time, he was very confused, "Then again, why are people's chips for five or six years still more reliable than our own?" ”