The semiconductor industry in the closure of the US factory of Samsung Electronics … “Intensification of supply shortages and price increases”

Check-in 2021.02.23 10:41

Increasing the supply load of the SSD controller chipset
Trend Force “The imbalance between supply and demand for semiconductors will deepen”
Up to several months to normalize production at Samsung Austin Fab
Legacy semiconductor supply shortages will worsen

Amid global semiconductor supply shortages, even Samsung Electronics’ Austin Foundry factory shut down in the US cold snap. There is even a forecast that semiconductor prices, which are still rising, will rise. more abruptly, leading to a “semiconductor crisis.”

Market research firm Trend Force said in a report on the 23rd that the closure of Samsung Electronics’ Austin factory increases lead time (the time from order to delivery) of the controller chipset for the drive unit. solid state (SSD), which is likely to act. as a price rise factor.

Trend Force said: “Samsung Electronics has been producing NAND flash and SSD controller chipsets with a 14- to 40-nanometer process (nm · 1 nanometer is one billionth of a meter) at the Austin factory.” “The production impact of this controller chipset is limited, but there could be a potential price increase due to a rush order from an SSD buyer.”

The SSD price hike trend has already started. Major PC OEMs are negotiating to purchase SSDs. Among them, the closure of Samsung Electronics’ Austin factory is expected to increase the burden on the supply of controller chipsets. Trend Force said: “It is impossible to rule out the possibility of an increase in the price of the total price of SSD.”

In the United States, a record cold snap has increased damage across the country. Of these, Texas is believed to be the most serious. With domestic electricity shortages for heating, the city of Austin, the capital of the state of Texas, asked local conglomerates to shut down their plants.

In Austin, there are Samsung Electronics, NXP, an automotive semiconductor company, and Infineon, Germany. Samsung Electronics’ Austin Fab was closed as of 4 pm on the 16th (local time). This plant has been closed for the first time since it became operational in 1998. The city of Austin notified Samsung Electronics that it would be three days later, but there has been no news that power has been restored.

Even if Samsung Electronics’ Austin factory resumes operations, it will take some time for production to recover. The industry is fortunate to recover production in days, but in the worst case, it can take months to normalize. This is because each production line must be reorganized to resume operation. Samsung Electronics is focusing its efforts on recovering production by sending technical personnel.

Samsung Electronics’ Austin Fab primarily manufactures Qualcomm’s fifth-generation mobile communications radio frequency (5G) chipsets with an 11-14 nanometer process. It also produces products from Samsung Electronics’ System LSI division and automotive semiconductors such as Tesla and Renesas through a 28- to 65-nanometer process. Trend Force said: “The 12-inch bartender capacity of the Austin factory represents 5% of world production. This power outage is expected to reduce the overall capacity of the 12-inch factory by 1-2%.” .

The prices of memory semiconductors, such as SSDs, have been on an upward curve since last year. Expectations for the so-called “supercycle” are also rising. According to DRAMeXchange, a semiconductor market research company, the spot transaction price for PC DRAM (based on 8Gb DDR4) at the end of January was $ 4.10. In this situation, natural disasters such as cold waves overlap and the pressure to increase prices is increasing.

The NXP and Infineon plants in Austin are also expected to close due to a cold snap, further exacerbating the automotive semiconductor supply shortage. NXP and Infineon are leading companies competing for first and second place in this market with 21% and 19% market share, respectively.

Market research firm IHS Markit predicted that production of 1 million units in the first half of this year will be disrupted due to recent automotive semiconductor supply shortages. Ford, Volkswagen and GM have reduced production due to the lack of semiconductors.

Previously, NXP notified its customers that it would increase the price of automotive semiconductors due to rising raw material costs and supply shortages. The level of increase is known to be 10-20%. It is also reported that Taiwanese TSMC, which manufactures more than 70% of the world’s automotive microcontrol units (MCUs), recently announced that it will increase its supply price by 15%.

An industry insider said: “Semiconductor companies have already announced a price increase, but the increase will increase further due to factory closures due to natural disasters such as a cold snap,” he said. “In general, difficulties for semiconductor companies may also have the possibility that the industry, which was slow due to oversupply, will improve again.”