Edgewater Research: Supply Chain Weekly Digest

Important Disclosures in the Appendix

A weekly collection of news summaries, survey results and channel insights, and report summaries from Edgewater Research

DATAPOINT OF THE WEEK:

China November retail auto sales totaled 2.08m units, a 2.4% M/M and 26% Y/Y increase according to the China Passenger Car Association (CPCA). The slight m/m uptick implies a modest strengthening of demand, typical for the winter season in China, though CPCA noted that was propelled by intensified promotions for both ICE and NEV vehicles. CPCA Secretary General Cui Dongshu said dealers in China are facing tremendous pressure to meet operational and sales goals near the year-end, and this has depressed their earnings. Sales of domestic vehicles continued to outperform the market, growing 29% Y/Y while sales of multinational brands posted strong 22% growth, but lagged the market, indicating continued share losses for multinational brands. NEV retail sales in November totaled 841k units, an increase of 9% M/M and 40% Y/Y. The figure is higher than the preliminary CPCA estimate of 783K units. BEV retail sales totaled 550K a 27% Y/Y increase while PHEV sales surged 75% y/y to 290k. CPCA added that China exports declined 3% M/M but remained strong on a Y/Y basis surging 50%.

Headlines:

Auto

• BYD set another record for deliveries in November with units surging 31% Y/Y
• Continental accelerating cost-saving actions in Auto; considering a sale of auto user experience assets
• Ford sales in the US dropped 0.5% Y/Y in Nov, while EVs showed slight improvement
• EV charging plans slowed by EU's power grid problems and red tape
• US House Republicans voted to halt Biden EV regulations
• EU proposes three-year delay before EV tariffs hit UK trade
• Fear of cheap Chinese EVs spurs Western automakers to squeeze supply chain and materials costs
• EU offers battery makers €3bn to jump start electric vehicle industry
• Germany auto sales turned negative Y/Y in Nov; EV sales drop for third consecutive month Y/Y
• Stellantis to cut Detroit SUV production, citing California emissions rules
• Unions in Norway and Finland vow to blockade Tesla shipments in support of Swedish union dispute
• Tesla standard range Model Y sold out through year end in China
• Tesla plans to restart Giga Shanghai phase 3 project, 6 months after suspending it
• US November auto sales into fleets declined 9% Y/Y while retail sales increased 10% says Cox
• US Auto dealer sentiment tumbles in 4Q on economy, interest rates concerns says Cox

Aerospace

• Boeing signals two-month delay to 737 production ramp-up

Semiconductors

• AMD announces its AI GPU chip; projects AI chip TAM of $400B in three years
• Broadcom projects FY24 revenue below expectations amid slower semi, enterprise software demand
• China's chip tool imports rose 80% in October ahead of US restrictions
• 3Q23 top 10 foundry sales increased 8% Q/Q says TrendForce
• Nexperia announced its first SiC MOSFET
• Gartner forecasts 2024 global semi sales increasing 17%
• October semi sales increased 3.9% M/M according to SIA
• Taiwan PMIC suppliers looking to penetrate supply chain for AI servers
• TSMC reaches agreement with Arizona unions covering employment, training, and safety
• TSMC rumored to decrease its capex in 2024 by 6-12%
• Toshiba, Rohm to invest $2.7 bln to jointly produce power chips
• Western Digital to raise NAND flash prices by up to 55%
• UMC November sales declined 2% M/M and 17% Y/Y

Consumer/EMS/Distribution

• Apple aiming to build 50M iPhones in India within the next two to three years
• Farnell adds Panasonic power components to its portfolio
• PC shipments slipped 20% M/M in October says DigiTimes
• Canalys projects 2024 PC shipments increasing 8%
• 3Q23 global smartphone production returned to growth for first time in 9 quarters, according to TrendForce
• 3Q23 global wearable shipments increased 3% says IDC