Most of it is assembly not manufacturing, in fact car manufacturers are cutting down production due to low supply of chips. India should focus on getting silicon fabrication plants to cut dependence on imports and move up the value chain.
Breakingviews - India Insight: Elbows out on world’s factory floor
“Make in India” could start to live up to its motif of a lion on the prowl. Local and foreign companies are queuing up to tap incentives for creating large onshore manufacturing capacity in electronics, solar panels, pharmaceuticals, advanced batteries, specialty steel and more. Samsung...www.reuters.com
Indian Electronics Manufacturing Developments : News, Updates and Discussions
- Thread starter RISING SUN
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Chinese are intentionally or unintentionally are choking our manufacturing sector by creating component shortage. That Rahul Bajaj looser was bullish on China for manufacturing and assembly of his cheapskates called Baja/Boxer is African market. While TVS went alone on its own and is now competing neck to neck with all the established rivals including Baja.
There is massive shortage of chips in market and whoever pays higher price, they get the major stock supply. Profit margin in Auto industry is high compared to say a financial product like payment cards. Hence when auto industry is under pressure for chips stock procurement, consider what would have been happening in banking and financial sector...
It doesn’t work that way. The sequence of events which led to the chip shortage is like this. During first wave of Covid I.e. March 2020, auto manufacturers expected a massive slump in sales and hence cut down order for chips. At the same time, consumer electronics sector witnessed massive growth (25 - 30%) and grabbed the slots reserved for auto manufacturers. Surprisingly demand for cars bounced back within a quarter or two, but by that time their slots were gone and consumer electronics is showing no signs of slowing down. Please note that the no of chips consumed in consumer electronics segment is 20-30 times more than auto industry. Hence car makers don’t have the heft to dictate terms. They will have to wait till additional capacity is added. I would expect the current problem to continue till 2023.
Cool fiction! Buddy you are telling the story to a person who actually has a say in chip procurement for critical infrastructure at national level. And just for the knowledge chip supply chain got impacted well before COVID. COVID has just brought the system cracks in public view. There is a crisis knocking on the door, let's see who hears it first in public. Challenging times ahead...
China was inside our system for quite some time before some of it got detected due to fishy transfers. It practically owns the Indian critical infrastructure. Ferocity of one such attack was that central government had to bite the bullet to shut down the entire national system. People were aware such crisis happened suddenly but it was comical to actually see people looking at the wrong end of stick. And that happened in last five years in full public view, is quite a telling story.
China is indeed intentionally choking entire global supply chain since second half of Trump administration and we are a small pawn in the game being a consumer driven economy.
And I sell UNCLE chips !! "person who actually has a say in chip procurement for critical infrastructure at national level"
.. Seriously dude.. national level ?? Ok, let me give some back ground about myself. In my current role, I manage multiple chip design projects and each of them get manufactured in 10 - 100 + million range, depending on the final product line. So far we have not faced any problem in getting super hot lot with any of our contract manufactures/foundries. I am sure you understand what "super hot lot" means.BTW, Renesas, NXP, Qualcomm, ST micro, all these companies are dominant suppliers for both Auto industries as well as consumer electronics. Care to explain why auto makers are slashing their production while there is no shortage of mobile phones in market
? Please also be kind enough to share " the crisis" with lesser mortals like me.
If you have some spare time, read the last paragraph of the link. Looks like CNBC also spreading the same fictional story.
Chip shortage expected to cost auto industry $110 billion in revenue in 2021
The estimate is up 81.5% from an initial forecast of $60.6 billion from consulting firm AlixPartners.
I think we could end up with oversupply in 3-5 years.And I sell UNCLE chips !! "person who actually has a say in chip procurement for critical infrastructure at national level"
BTW, Renesas, NXP, Qualcomm, ST micro, all these companies are dominant suppliers for both Auto industries as well as consumer electronics. Care to explain why auto makers are slashing their production while there is no shortage of mobile phones in market
Please also be kind enough to share " the crisis" with lesser mortals like me.
If you have some spare time, read the last paragraph of the link. Looks like CNBC also spreading the same fictional story.
Chip shortage expected to cost auto industry $110 billion in revenue in 2021
The estimate is up 81.5% from an initial forecast of $60.6 billion from consulting firm AlixPartners.www.cnbc.com
Understanding the role of ASML in the whole supply chain is critical to give any take on the industry as a whole.
That is correct. The supply demand mismatch might end up causing oversupply. Apart from that Geopolitics/ autonomous cars/ wearables etc are also impacting overall chip industry and makes it very difficult to predict the future.
Yes we do actually have majority market share in critical infrastructure supply, hence we work under RBI and other financial watchdog's. Refer to previous post, we were informed by watchdog, exactly for this reason, on actual troubles months before it actually hit the common people. Mind you what we do here, there are less no of companies here than we have fingers in our hand! Not every company CEOs are asked to be present for yearly meeting with PMO, do they?And I sell UNCLE chips !! "person who actually has a say in chip procurement for critical infrastructure at national level"
BTW, Renesas, NXP, Qualcomm, ST micro, all these companies are dominant suppliers for both Auto industries as well as consumer electronics. Care to explain why auto makers are slashing their production while there is no shortage of mobile phones in market
Please also be kind enough to share " the crisis" with lesser mortals like me.
If you have some spare time, read the last paragraph of the link. Looks like CNBC also spreading the same fictional story.
Chip shortage expected to cost auto industry $110 billion in revenue in 2021
The estimate is up 81.5% from an initial forecast of $60.6 billion from consulting firm AlixPartners.
Not entirely true, until now semi-industry was cyclical there used to peaks & troughs. This was mostly bcos most of the chips used in less applications and biggest driver of semiconductor was IT industry. IT industry's chip barometer mostly was RAM chips which usually stayed the same for 3-5 years. To make things worse there are only 3-4 companies which have the latest tech & who can meet the demand. They will virtually form a cartel and control the supply ( they have done that in past).
The chips that you are talking about might be in power electronics , those chips are manufactured by smaller players. Mostly licensed (or cheap copies) from TI or NXP to smaller chinese companies (other than SMIC). Those are lesser fries compared to the bigger ones in the semi-conductor industry. It is really a shame that India imports those chips instead of manufacturing on our own.
ST, NXP, Gmalto, GFX, Multos and they are not small supplier in India except Multos, I have forgotten already older ones worked on few years back. Almost all of chip import happens from China (HK majorly). There is zero supply from within India, none in our field. Nobody realizes this but China practically owns the critical infrastructure(under RBI domain). They could be inside the system gathering information and people are running after Chinese apps ban (that's also required but less of security threat compared to our field of work.)
I cannot comment on what theory you were presented by the watchdog, since you didn't share any over here. However, let's go over few things.
1. Not every sector is equally impacted as you can walk into any mobile store and find whatever model you want to buy.Not the same case with auto dealers. I want to buy a 2022 model big size luxury SUV and there are hardly any in market. Before pandemic, every dealer used to have 10s of model by September.
2. You can just google and find tons of articles explaining the reason for chip shortage in auto industry and it's more or less same as I mentioned earlier (the cool fiction according to you).
3. If you are speaking the truth, then the watchdog presented BS of purest quality. I would strongly recommend to cross check the facts/ theory and do some analysis.
Let me help you with another article from Bloomberg.
Chip Crunch May Last a Year Amid ‘Perfect Storm,’ IMI CEO Says
(Bloomberg) -- Chips are set to remain in short supply for at least a year as demand from carmakers and other manufacturers remains robust, and ramping up production capacity takes time, said the head of Southeast Asia’s Integrated Micro-Electronics Inc.The maker of electronic components, a unit...
What watchdog shared and gave instruction to counter act, was happening already and we were loosing big amount transfer overseas monthly basis. And yes as it was marked secret, hence not to be seen by public. You must be aware of NDAs in such matters. Nobody will divulge that kind of information.I cannot comment on what theory you were presented by the watchdog, since you didn't share any over here. However, let's go over few things.
1. Not every sector is equally impacted as you can walk into any mobile store and find whatever model you want to buy.Not the same case with auto dealers. I want to buy a 2022 model big size luxury SUV and there are hardly any in market. Before pandemic, every dealer used to have 10s of model by September.
2. You can just google and find tons of articles explaining the reason for chip shortage in auto industry and it's more or less same as I mentioned earlier (the cool fiction according to you).
3. If you are speaking the truth, then the watchdog presented BS of purest quality. I would strongly recommend to cross check the facts/ theory and do some analysis.
Let me help you with another article from Bloomberg.
Chip Crunch May Last a Year Amid ‘Perfect Storm,’ IMI CEO Says
(Bloomberg) -- Chips are set to remain in short supply for at least a year as demand from carmakers and other manufacturers remains robust, and ramping up production capacity takes time, said the head of Southeast Asia’s Integrated Micro-Electronics Inc.The maker of electronic components, a unit...finance.yahoo.com
1. Yes, exactly my point, profit margin varies from industry to industry, hence some sectors affected very badly and some in good shape. Refer to initial post no 242.
2. China manipulating the supply chain is the key factor and it's not a fiction. Whoever pays the bigger amount gets the pie in current situation.
3. What watchdogs had shared was validated over the course of two months and then the big bang announcement by none other than PM himself indirectly. We were amazed how people had the news in front of them barely two months ago and they still couldn't connect the dots. No articles were written on it except one leading to the speculation in those who knew what was happening, is that government perhaps had pushed news agencies for a specific tone/story even to the detriment of their short term loss.
You can have NDAs for specific information, overall market movements are not exactly secrets. Majority of chips used in auto industry are fabricated in Europe, USA, Japan and Taiwan (Renesas, NXP, ST, Qualcomm and Broadcom). So China doesn't have much control over it.
Anyway there are not many dots to connect or any mystery. It's a straight forward case of demand and supply reallocation.
India, Taiwan May Ink Mega Deal to Set Up Chip Manufacturing Plant. Here's Why it's Global Rescue - News18
New Delhi and Taipei have met in recent weeks to discuss a deal that would bring a chip plant worth an estimated $7.5 billion to India.
www.news18.com
The Bloomberg report said that officials in New Delhi and Taipei have met in recent weeks to discuss a deal that would bring a chip plant worth an estimated $7.5 billion to India to supply everything from 5G devices to electric cars