Weekly Electronics News From R&A(2/3)

Catalog

1.?India raises tax on car imports

2.?Omdia:Sony holds over 50% of the CIS market for 3 years

3.?Suzuki announces investment in electric vehicles

4.?Qualcomm Sales of last years Disappoints, smart phone market may hardly pick up in the fist half of 2023

5.?Tesla plans to increase its capital expenditure in 2022 due to the sharp slowdown in revenue growth in China

01. India raises tax on car imports

Reportedly, India on Wednesday said it will raise taxes on imported cars and motorbikes, including electric vehicles (EVs), as it seeks to boost local manufacturing in line with Prime Minister Narendra Modi's "Make in India" campaign.

All vehicles with a landed cost of less than $40,000 will be taxed at 70%, up from 60% earlier. It is reported that cars with a landed cost of more than $40,000 will be imposed at 100%.

Besides, import tax on electronic vehicles and all semi-knocked-down cars - where major parts are imported separately and the final vehicle is assembled in the country - will be raised to 35% from 30%. The tax hikes come into effect from April 1.

Taxes on automobiles in India, the world's third-largest car market, rank among the highest globally, drawing criticism from companies such as Tesla which shelved plans last year to enter the market because of high tariffs.

Carmakers including South Korea's Hyundai Motor and Kia Corp, Germany's Volkswagen AG, Skoda Auto and Japan's Toyota Motor Corp sell imported cars in the country, with some also selling electric models. India's EV market is small - making up about 1% of total car sales in the country in 2022 - but growth has been rapid, with domestic carmakers Tata Motors and Mahindra & Mahindra as well as global rivals BYD and SAIC's, MG Motor lining up new launches.

Comment: India has seen strong rebound in car sales, which rose 25% to 3.8 million in 2022. Growth in premium and luxury cars was higher, with carmakers like Mercedes-Benz and BMW reporting record sales in the country. Global carmakers who are banking on buoyant consumer demand in the premium and luxury space will be affected, Rajat Mahajan, partner at Deloitte India said, adding that some companies may absorb this cost to benefit from the recent surge in demand.

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02. Omdia:Sony holds over 50% of the CIS market for 3 years

According to the new report from the market research firm Omdia, the overall size of the global CIS market in the third quarter of 2022 is US$4.733 billion, an increase of 13.6% from US$4.168 billion in the second quarter of the same year. However, The figure is a slight decrease compared with the US$4.866 billion in the same period in 2021. Sony remains the dominant place in the global CMOS image sensor (CIS) market. In the third quarter, Sony's CIS market share has exceeded 50% for three years in a row, with sales of 2.442 billion US dollars, holding a share of 51.6%.The share of CIS of Sony is over three times the size of Samsung’s 15.6% that ranks second in CIS market share. Samsung Electronics, on the other hand, recorded sales of just $740 million in the third quarter of last year. The firm who had maintained sales of US$800-900 million per quarter in the CIS market in the past, experienced a sharp decline in the third quarter of last year. The third to fifth places are OmniVision Technology with US$460 million, accounting for 9.7% of CIS market share, ON Semiconductor US$330 million, taking 7.0%; GalaxyCore Inc. US$188 million, holding 4.0% share. SK Hynix’s rapid growth also become another highlight of the CIS market in the third quarter of last year. It ranked sixth with the CIS sales of US$180 million in the third quarter, up by about 20% compared with the previous quarter.

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The reason why Sony performed well in the CIS market in the third quarter is that it acquired various customers. For an instance, Xiaomi ultimate in 2021 is equipped with Samsung' CIS, but the "Mi 12S Extreme Commemorative Edition" released last year applied Sony's 1-inch image sensor IMX989. The Sony’s sensor has been used in Sony's upscale camera RX100 VII. "Sony has been increasing its CIS market share by the best sales of its major customer Apple's smartphones, and expanding its automotive business by enhancing its production system through a partnership with TSMC," said an industry source.

Comment: CIS is a system semiconductor that converts light passing through a lens into an electrical image signal. It has low power consumption compared with other image sensors and has been actively used in camera of smartphones. In recent years, it has been widely applied in various fields such as robotics, autonomous driving, and augmented reality (AR).

03. Suzuki announces investment in electric vehicles

Suzuki Motor Corp. announced on Thursday that it will invest 4.5 trillion yen ( $34.8 billion) in research and development and capital expenditures to produce pure electric vehicles (EVs) by fiscal year 2030.

?Sources:Suzuki Motor

?Suzuki divides the 4.5 trillion yen investment into two parts, with 2 trillion yen invested in electrification and autonomous driving technology and 2.5 trillion yen allocated to building battery electric vehicle plants and renewable energy facilities.Suzuki Motor said that of the funds earmarked for electrification, 500 billion yen will be used to invest in batteries.

Suzuki will launch its first battery-electric vehicles in Japan by 2023, including small battery electric vehicles SUV and mini electric cars. With cost-sensitive customers in mind, Suzuki president Toshihiro Suzuki said he expects the new cars to be priced at about 1 million yen.

Suzuki plans to launch all-electric cars in Europe and India next year, and the first battery electric motorcycle globally. The company aims to partner with Toyota to capture a larger share of India’s emerging electric vehicle market.

Comment: Toshihiro Suzuki also said the company is not abandoning its hybrid and internal combustion engine vehicle lines due to concerns about charging infrastructure, the cost of electric vehicles and concerns about battery resources.For India, Suzuki’s main market, the company expects electric vehicles to account for 15% of its vehicle lineup by 2030, while internal combustion engine vehicles using biofuels and ethanol as fuel will account for 60%.

04. Qualcomm Sales of last years Disappoints, smart phone market may hardly pick up in the fist half of 2023

In the first quarter, which ended Dec. 25, Qualcomm said revenue fell 12% to $9.46 billion, missing analysts’ average projection, net profit by 34% to $2.24 billion. The company posted adjusted profit for the first quarter of $2.37 a share. Analysts on average were looking for per-share profit of $2.35.

Qualcomm said that The deterioration of the macroeconomic environment and the increase in channel inventory have lagged the company's performance

Revenue will be $8.7 billion to $9.5 billion in the fiscal second quarter, Qualcomm said Thursday in a statement, compared with analyst estimates for sales of $9.58 billion. Excluding certain items, profit in the current period will be as low as $2.05 a share, while the average projection was for per-share profit of $2.29.

In the past year, Qualcomm shares fell 28%, while the S&P 500 index slipped 9% over the same period.

Qualcomm's CDMA Technology (QCT) division's quarterly revenue (including smartphone chips, radio frequency front-end components, automotive chips and Internet of Things devices) was $7.89 billion, down 11% year-on-year, and less than analysts' expectations of $8.03 billion.

Handset chip revenue was $5.75 billion, a decline of 18% year-over-year, but higher than analysts' forecast of $5.2 billion. In addition, revenue from the Qualcomm Technology Licensing (QTL) segment was $1.52 billion, falling 16%, slightly below analyst average projection of $1.54 billion.

The recession in Qualcomm's sales is largely due to weak demand for the mobile phone. Global smartphone shipments unprecedentedly plummeted 18% year-on-year in the fourth quarter, according to estimates from IDC.

the company further cuts off the spending given the disappointed economy and demand,Qualcomm Chief Executive Cristiano Amon said,adding at the financial report meeting: "As the demand in the mobile phone industry remains sluggish, we now expect the increase in channel inventory levels to last at least in the first half of 2023." The low-end mobile phone market has the weakest demand. Amon revealed that Qualcomm executives expect that shipments of 3G, 4G and 5G mobile phones in 2023 may decline further compared to 2022 owing to the increased risks to the global economy and production shutdowns caused by the epidemic.

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Comment: Qualcomm projects that customers with large inventories of unused parts to wrap up inventory reduction efforts around the middle of the year, returning to more predictable order patterns in the second half of the year. Company executives disclosed at the meeting that China as the world's largest mobile phone consumer market, recently optimizes the epidemic prevention measures with an expectation of promotion of consumer demand in this market.

05. Tesla plans to increase its capital expenditure in 2022 due to the sharp slowdown in revenue growth in China

On January 31, Tesla’s 10-K filing submitted to the U.S. Securities and Exchange Commission (SEC) shows that Tesla’s total revenue in 2022 will be US$81.462 billion, a year-on-year increase of 51%. Among them, the Chinese market achieved revenue of US$18.145 billion, accounting for 22.27%; the US market achieved revenue of US$40.553 billion, accounting for 49.78%, and is still Tesla’s largest market. Its shares were down about 1% in pre-market trading in the U.S.

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In terms of growth rate, the US not only accounts for Tesla’s highest proportion of revenue, but it also has the largest year-on-year increase. Its revenue in 2022 increased by 69.09% compared with $23.973 billion in 2021. Revenue from other markets in 2022 increased by 42.22% compared with 16.006 billion yuan in 2021. China’s market revenue increased by 31.07% compared with $13.844 billion in 2021. However, before that, the growth rate of the Chinese market exceeded 100% for two consecutive years.

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Tesla produced a total of 1,369,611 vehicles and delivered 1,313,851 vehicles in 2022. In 2022, Tesla’s total revenue was $81.46 billion, representing an increase of $27.64 billion, compared to the prior year. The net profit was $12.56 billion in 2022, with a year-on-year increase of US$7.04 billion. The capital expenditures were $7.16 billion in 2022 and $6.48 billion in 2021.

In the first quarter of 2021, Tesla's investment in Bitcoin totaled $1.5 billion, and as of December 31, 2022, Tesla recorded an impairment of $204 million due to changes in the book value of Bitcoin, the company’s $64 million gain from converting bitcoin to fiat currency.

Teals expects to spend between $7 billion and $9 billion in 2024 and 2025, compared with $6.00 billion to $8.00 billion in 2023. The company plans to invest another $3.6 billion to expand the Nevada Gigafactory for mass production of Semi-electric trucks. In addition, Tesla will also build a new 4680 cell factory (with capacity to produce enough batteries for 1.5 million light duty vehicles annually) and hire 3,000 new employees.

Comment: Tesla will also increase production at its factories in Berlin, Germany, and Austin, Texas, while grappling with continued price increases for raw materials such as lithium. As the economy slows down, Tesla has slashed prices on some of its models, trying to use its strong profit margins and large production scale to fight off rising competition.

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