Edgewater Research: Electronic Component Weekly Digest - April 15

Weekly Update from Edgewater Research

DATAPOINT OF THE WEEK:

China's Auto Market Sees Growth in March: Auto passenger retail sales in China showed positive movement in March, growing by 6.3% year-over-year. This marks a slowdown from the growth trends observed in the second half of 2023. In more detail, New Energy Vehicle (NEV) sales in March reached 710,000 units, exceeding preliminary estimates of 698,000 but falling short of the 750,000 anticipated at the month's end. NEV sales saw a 31% year-over-year increase, driven by a significant 76% rise in Plug-in Hybrid Electric Vehicle (PHEV) sales, while Battery Electric Vehicle (BEV) sales saw a more modest increase of 11%. Overall, for the first quarter, total passenger vehicle sales rose by 13%, with NEVs up by 35%, BEVs by 15%, and PHEVs by 76%. Additionally, China exported 424,000 vehicles in March, including 124,000 NEVs, marking increases of 39% and 52% year-over-year, respectively.

Headlines:

Auto Industry:

• Global and Regional Developments:
  • BMW reports a modest 1% increase in Q1 global deliveries; EV sales jumped by 28%.
  • Increased demand for new car-carrying ships sparked by China's EV export boom.
  • Industry updates indicate China is reducing unused auto production capacity.
  • Chery of China is close to finalizing a deal to start manufacturing cars in Spain.
  • EV sales growth in the US slows to 2.6% in Q1, as reported by Cox Automotive.
  • Chinese EV brand Hyper plans to incorporate all-solid-state batteries in its vehicles by 2026.
  • Ford rethinks its retail model in Europe and slashes prices on various F-150 Lightning models.
  • Despite supply chain issues in Asia impacting deliveries, Mercedes-Benz's Q1 sales dropped 6%; EV sales down 9%.
  • Tesla maintains steady production in Shanghai; marked increase in exports contrast with a drop in local deliveries.
  • VW reports a 3% rise in Q1 global deliveries despite a downturn in EV sales.

Datacenter:

• Investments and Innovations:
  • Microsoft commits US$2.9 billion to enhance its AI operations in Japan.
  • Google and Meta both announce next-generation developments in their internal CPU and AI chips.

Semiconductors:

• Sector Movements:
  • Intel confirms layoffs within its Sales and Marketing Group and unveils its third-generation AI accelerator.
  • Partnerships and expansions noted for Infineon, Amkor, and Microchip, with Microchip also acquiring connectivity specialist VSI.
  • The Taiwan earthquake expected to slightly impact Micron's DRAM supply.
  • Renesas reactivates a long-dormant plant to meet demand for power chips.
  • TSMC announces significant U.S. investment and subsidy gains, alongside price increases due to strong demand.

Other News:

• Tech and Consumer Electronics:
  • Apple set to unveil new iPad Pro and iPad Aid models in May.
  • IDC reports a return to growth in the PC market for the first time in two years, while Apple and Samsung adjust their smartphone shipment forecasts downwards for 2024.