Weekly News

Contents:

1. Renesas Commences Operations of Kofu Factory as a Dedicated 300-mm Wafer Fab for Power Semiconductors.?

2. TrendForce reports that enterprise SSD prices will rise by 20-25% in Q2 2024.

3. Brand handset vendors reportedly cut the 2024 shipment outlook.

4. AUO and Innolux see 1Q24 panel shipments exceed forecasts.

5. VW will invest $2.7 billion in China to accelerate the EV rollout.

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1. Renesas Commences Operations of Kofu Factory as a Dedicated 300-mm Wafer Fab for Power Semiconductors.?

Renesas, a premier supplier of advanced semiconductor solutions, announced that it has started operations at its Kofu Factory in Kai City, Yamanashi Prefecture, Japan. Renesas aims to boost its production capacity of power semiconductors in anticipation of the growing demand for electric vehicles (EVs).

The Kofu Factory previously operated both 150mm and 200mm wafer fabrication lines under Renesas Semiconductor Manufacturing Co., Ltd, a wholly-owned subsidiary of Renesas, but ceased operations in October 2014. Renesas made the decision to re-open the factory in May 2022 as a 300-mm wafer fab to support the growing demand for power semiconductors, which is propelled by the industry-wide goal to realize a decarbonized society.

Comment:?

Currently, global power semiconductor production mainly relies on 200mm wafer lines. Renesas's expansion of 300mm wafer lines will increase its production capacity and efficiency. Additionally, considering the potential "chip shortage" crisis in power devices in the future, its proactive expansion is expected to extend its market share and enhance its competitiveness within the industry.

2. TrendForce reports that enterprise SSD prices will rise by 20-25% in Q2 2024.

Amid the AI boom, AI acceleration cards get popular while the prices of hard disk drives (HDD) and solid-state drives (SSD) are pushed up.

Citibank recently noted that SSDs are faster and more suitable for training AI than HDDs. Industry insiders point out that SSDs are about ten times faster than HDDs in terms of access speed, leading to a trend where SSDs are replacing HDDs in AI.

In recent years, as NAND flash prices have gone down, the cost gap between SSDs and HDDs has shrunk, making SSDs a good alternative to HDDs in some areas. For example, HDDs have been phased out in consumer PC storage devices under 2TB, with SSDs taking their place.

TrendForce predicts that NAND flash contract prices will grow strongly by about 13-18% in Q2 2024, with enterprise SSDs expected to soar by 20-25% quarter-over-quarter.

Comment:

The AI market drives demand for high-capacity HDD products, causing overall prices to soar. According to the latest news, Western Digital, a major U.S. memory manufacturer, confirmed on April 8 that HDD and SSD demand is outstripping supply, officially informing customers of continued price increases for NAND Flash and complex drive products. Industry insiders expect the shortage of high-capacity HDD products to last this quarter or throughout the year. The prices are forecast to rise by 5-10% in the second quarter of this year.

3. Brand handset vendors reportedly cut the 2024 shipment outlook.?

Speculation has recently circulated in the mobile phone market that brand vendors, including Apple and Samsung Electronics, have revised their shipment projections for 2024 downward.

Research firm TechInsights predicted that the lifespan of global smartphones stretched 51 months in 2023, never seen before. Cycles to change the phones in Chinese consumers have slightly shortened but still exceed 40 months.

As the lifespan of smartphones is prolonged, market competition intensifies. At the same time, consumer perceptions are shifting as they emphasize phone durability and practicality rather than seeking faster replacement cycles, such as with iPhones.

Comment:

Experts note that consumer expectations have shifted towards longer lifespans, leading them to be more willing to pay a higher price for superior performance and durable phones. As the market becomes increasingly saturated, phone manufacturers strive to improve product quality and raise prices to secure higher profits.

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4. AUO and Innolux see 1Q24 panel shipments exceed forecasts.?

The LCD panel market performed strongly in the first quarter of 2024, with Taiwanese panel manufacturers Innolux and AUO outperforming expectations. Innolux reported revenue of about $623 million in March, surging by 45.1% monthly and 15.0% annually, with shipments also rising. AUO's March consolidated revenue was around $457 million, up 6.9% Month over Month and 10.5% Year over Year.

Innolux prepared in advance by raising its inventory, anticipating a rush order effect in the first half of 2024, and making appropriate preparations. AUO is optimistic about the AI PC market and the impact of Microsoft's discontinuation of support for Windows 10, predicting demand for replacements and upgrades between 2024 and 2025.

Comment:?

Major sports events like the UEFA Euro 2024, Copa America, and Paris Olympics may also drive demand for large-size, high-specification TVs.

5. VW will invest $2.7 billion in China to accelerate the EV rollout.?

Volkswagen Group China announced on Thursday that it would invest 2.5 billion euros (about 2.68 billion U.S. dollars) in expanding its innovation hub in Hefei, the capital of east China's Anhui Province, to increase its pace of innovation in China.

Preparations are also being made for the production of the two Volkswagen brand models being developed together with Chinese partner XPENG to begin in 2026, it said.

Noticeably, Volkswagen has remained the top player in the Chinese market for many years. However, its overall market share has fallen from 18% in 2018 to 14% due to the decline in internal combustion engine car sales, while domestic electric vehicle manufacturers in China have gained a larger market share.

Comment:

In 2023, Volkswagen delivered 3.236 million vehicles in the Chinese market, while the largest domestic electric vehicle manufacturer, BYD, sold 3.02 million vehicles.

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