On November 1st, at the Automotive Chip Sub Forum of the 2023 Global New Energy and Intelligent Vehicle Supply Chain Innovation Conference, Zhao Bin, Vice President of Yuexin Semiconductor Strategic Products and Markets, delivered a keynote speech on the industry opportunities, pain points, and how to build domestic chips from the perspective of wafer foundries.

　　Zhao Bin, Vice President of Yuexin Semiconductor Strategic Products and Marketing; Source: China Electric Vehicle Hundred People Association

　　At present, the development of new energy vehicles is very rapid. Zhao Bin believes that the important driving force for the sustainable development of new energy vehicles in the future is the on-board semiconductor. On the other hand, from the perspective of semiconductors, as the entire semiconductor industry is still in a low valley, the key driver for recovery is also automotive chips.

　　Each fuel powered vehicle has an onboard content of approximately $500, while new energy vehicles have an onboard content of approximately two to three times. By 2030, new energy vehicles may even have over 2000 chips, which is further increasing. From the perspective of vehicle sales, on the one hand, the sales of the entire vehicle are increasing, and on the other hand, the proportion of new energy is increasing, reaching around 60% by 2030, which will drive the increasing demand for the entire vehicle chip. Thanks to this, the scale of the entire automotive semiconductor industry has almost doubled from around 74 billion this year to over 135 billion by 2030. During the decade 2020 to 2030, the growth rate of automobiles in the semiconductor segment was the fastest, reaching 14%, higher than several other major categories.

　　The biggest pain point in the entire industry at present, Zhao Bin believes, is that the portion of Tier 2 in automotive semiconductors is monopolized by foreign IDM companies. These companies are very strong, with a total market share of 49% in the top five and 70% in the top ten. According to the six major categories of computing and control, simulation and communication, sensor chips, power semiconductors, storage chips, and others, the best domestic automotive semiconductors are currently power semiconductors, with a market share of less than 10%. In the Tier 2 segment, the domestic strength is still very weak.

　　He divided chips into three categories: the first is chips that are easy to localize, the second is chips that are difficult to localize, and the third is chips that are extremely difficult to localize. The main issue with chips that are prone to localization lies in the issue of vehicle regulations. Once this aspect is resolved, consumer and industrial chips can be directly applied to vehicles through vehicle regulations, and cost control issues need to be addressed in the future.

　　The difficulty in localizing chips is mainly due to a lack of technology, while the extremely difficult localization of chips not only has a lack of technology, but also has the problem of technological monopoly, and even many processes cannot be achieved domestically, making localization very difficult.

　　The challenges faced by the development of the domestic chip industry include an incomplete standard system, incomplete testing platforms, insufficient research and development of technical capabilities, a lack of application of key products, a lack of accumulation of vehicle regulations and processes, and insufficient ecological construction.

　　Zhao Bin stated that automotive chips require extremely high performance, especially reliability. The entire temperature range, failure rate, usage time, operating time, including many vehicle specification verifications, have very high requirements. Therefore, the entire on-board chip will take at least three to five years from design to vehicle validation, and finally to actual use. Most Chinese companies are not large in scale, can they afford to spend five years researching and developing a product? "Zhao Bin believes that this long-term investment may be difficult.

　　In addition, Zhao Bin further pointed out that the entire automotive chip industry, from chip manufacturers to host manufacturers, has not formed a closed loop, which is also a major challenge in the automotive supply chain. Currently, there has been a transformation in the automotive supply chain model, with the traditional supply chain structure from car factories to Tier 1, Tier 2, and Tier 3 chains now becoming a network. Some OEMs not only achieve Tier2, but also directly communicate with wafer foundries. A new ecosystem of innovation that emphasizes autonomy, safety, and controllability is being established.

　　Due to the strong strength of Tier 2 and Tier 1 abroad, it will take ten years or even longer to quickly replace them solely by domestic Tier 1 and Tier 2, and the gap is very large. So Zhao Bin proposed that perhaps creating a collaborative model, the so-called Tier 1.5 model, is a solution. That is to say, to create some empowerment platforms, the simpler ones are solved by Tier 2 and Tier 1 using a normal mesh structure. For complex applications that cannot be solved, Tier 1.5 is formed. The entire vehicle factory, Tier 1, Tier 2, and even Tier 3 wafer foundries work together to create empowerment platforms, achieving advantage integration.

　　This article is reprinted from Gaishi Automotive Information Network