Market News

Volkswagen's Audi cuts output at Brussels plant due to parts shortage

Volkswagen's, luxury car brand Audi has reduced output at its Brussels plant, where it produces the Q8 e-tron model, for at least two weeks due to component shortages, a spokesperson said on Tuesday.

The carmaker was "deciding from week to week" when production would return to full capacity, the spokesperson said, confirming an earlier report in German autos publication Automobilwoche.

On Sunday, Automobilwoche reported that Audi planned to overhaul its global production network and may move the production of the Q8 e-tron to its site in San Jose Chiapa, Mexico, or China.

Comment: Audi was examining options for what models the Brussels plant should produce in the medium term and would provide further details after future planning rounds, the spokesperson said. The Mexico site was currently preparing to ramp up production of a successor to the Audi Q5 model but it could not yet confirm the model, the spokesperson added.

Large cylindrical cells may boost the main growth of EVE Energy Co., Ltd.

EVE Energy Co., Ltd., the Chinese battery maker, completed its large cylindrical cell 46 series production line in 2023.

Up to now, the large cylinder battery factory with an annual capacity of 20GWh of EVE has operated and put into production in the first phase. The 46 series of large cylinder batteries have been offline for more than 5.3 million units, officially realizing commercial delivery and application.

Previously, Tesla, BMW, and other new energy vehicle makers disclosed their interest in 4680 and 4695 large-cylinder batteries. EVE Energy will gradually shift its focus from pouch cells, prismatic cells, and cylindrical cells to large cylinder batteries.

Comment: On January 31 this year, EVE Energy’s large cylindrical cell 46 series was installed in some Chinese vehicles.

Korean Gov’t Lays Out Plan to Improve EV Subsidy Program

The Ministry of Environment announced on the same day that electric cars priced below 85 million won ($63,988) will be eligible to receive governmental subsidies. Cars under 55 million won will receive the greatest subsidies of up to 6.5 million won.

According to the revised plan, Hyundai and Kia will remain at the same level, while mid-sized Korean-based carmakers’ and imported EVs that mainly use lithium-iron phosphate (LFP) batteries will see their subsidies significantly cut.

In particular, in the case of KG Mobility, its flagship EVs such as the Torres EVX are all loaded with LFP batteries from Chinese manufacturers.

Comment: Car importers in Korea are also on edge. Many experts say that Tesla will be the hardest-hit EV brand. Tesla sold 16,461 units of EVs in the Korean market last year, making it one of the top five imported car brands in Korea. The sales figure was Tesla’s second-highest annual sales volume since 17,828 units in 2021 and a 13 percent year-on-year increase. This performance was driven by the Chinese-made Tesla Model Y rear-wheel drive (RWD) model, which began full-scale sales in Korea in the second half of last year.

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IMEC to site R&D fab in Malaga, Spain, say reports

Belgian research institute IMEC is going to open up a manufacturing facility – IMEC Fab 5 – in Malaga, Spain, according to politicians quoted by local publications.

Spanish Minister of Digital Transformation and Public Service, José Luis Escrivá said that IMEC has selected Malaga as its next location after signing an agreement in principle with the Spanish government in the summer of 2023 to establish itself in the country.

The second center (of IMEC) that is going to be created in Spain is going to be located in Malaga. In recent weeks the company has been working very intensely and with very good collaboration with the Junta de Andalucía and with the Malaga City Council that the second IMEC plant in the world is installed there.

Funds to support IMEC will come from the Spanish Ministry of Economy, Finance and European Funds and the Junta de Andalucia. However, the size of the funding, the scale of the subsidy, and the timetable were not mentioned in the reports, which said the final conditions are still under negotiation.

IMEC conducts world-leading research into semiconductors from its base in Leuven, Belgium, but also has separate centers and co-locations in many places around the world.

Comment: The regional government, the Junta de Andalucia, is quoted in elCorreoGallego saying that the project, known as IMEC Fab 5, is expected to create 450 direct jobs in Malaga in a new building at the Malaga Techpark. The property includes about 32,000 square meters of buildable space on a plot of 46,000 square meters, the report added.

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The Chinese market springs 12 inches rush orders, China’s SMIC says

?China's foundry leader SMIC held a conference call on Wednesday at Beijing time. New products in applications such as smartphones, smart homes, and PCs are showing an oversupply, even though the inventory of the Chinese chi suppliers stays high, the CEO of SMIC said at the conference. At present, domestic 12-inch rush orders are emerging, including 55-nanometer, 40-nanometer, and 28-nanometer basically at full capacity.

"AI is the highlight abroad, and smartphones are the growth in China." the CEO mentioned that in the second half of last year. The overall inventory in the market eased and the high-end products saw a rise.

In terms of SMIC's various product platforms, image sensors and display driver chips applied in cell phone terminals performed well. revenues from CIS and ISP grew more than 60% YoY, with production capacity in short supply. DDIC and TDDI surged 30% YoY in revenues, with strong competitiveness in the 40-nanometer and 55-nanometer node markets.

Comment: A swarm of urgent orders appears, though, in the first half of 2024, it is not sure that this circumstance will last until the latter half of 2024. Combined with price drop trends in advanced process products, consumer electronics like cell phones still face challenges.