Edgewater Research: Electronic Component Weekly Digest - Mar 11

This Week's Highlight: China's Auto Sales Momentum

January and February combined saw a significant 17% increase in auto retail sales in China compared to the previous year, according to the China Passenger Car Association (CPCPA). New Energy Vehicle (NEV) sales impressively grew by 37% year-to-date (YTD), with Battery Electric Vehicles (BEV) up by 17% and Plug-in Hybrid Electric Vehicles (PHEV) surging by 76% YTD. Despite a February slowdown due to the Chinese New Year and cautious consumer spending prompted by OEM price strategies, China's auto export grew by 18% year-over-year to 298,000 units, making NEVs 26% of total exports.

Automotive Sector Updates:

• BYD is making strides in Australia and Brazil, intensifying the electric vehicle (EV) competition in China with new price reductions.
• The EU is contemplating tariffs on Chinese EVs, with projections suggesting EVs will cost less to produce than gasoline vehicles by 2027.
• Ford and Nissan show strong sales, with Nissan exploring a partnership with Fisker.
• Rivian announces plans for 3 new lower-priced models, and Tesla navigates production challenges and expansion talks in Thailand.
• Stellantis secures approval for a joint venture and adjusts production in response to demand fluctuations.

Industrial and Semiconductor Highlights:

• Germany faces a sharp decline in factory orders, signaling broader industrial challenges.
• The semiconductor sector sees strategic moves from AMD, Broadcom, and Intel, amidst growing international competition and cooperation. China launches a substantial fund to bolster its chip industry as global semiconductor sales rise.
• Meta and Samsung explore new collaborations, while Tower Semiconductor and Western Digital adjust strategies in response to market demands.

Other Notable Developments:

• Apple and the broader smartphone market in China face sales challenges. Meanwhile, Jabil announces the closure of its Vancouver operations amidst varying confidence levels in the U.S. economy among CEOs.

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