Weekly News 044

Contents:

1. NVIDIA and Intel plan to release new AI chips for China.

2. VW pauses production at German EV plant.

3. NAND wafer prices rising.

4. Energy storage companies report bumper results in the first three quarters.

5. Vishay to Acquire Nexperia’s Newport wafer fab for $177 million.

                                                                                                                                                                                                                                                    

1. NVIDIA and Intel plan to release new AI chips for China.

NVIDIA will launch new artificial intelligence chips for China, covering HGX H20, L20 PCle, and L2 PCle, which were downgraded based on H100. To avoid new AI chip restrictions, Intel will also offer the low-level Gaudi2 for China.

Comment:

The procurement cost for computing rises by 50% in China’s market where the AI chips of NVIDIA and Intel cannot be sold. This brought a rapid gain to the computing lease. The downgraded AI chips from the two giants are anticipated to mitigate tense moments for computing in China.

                                                                                                                                                                                                                                                      

2. VW pauses production at German EV plant

Volkswagen Group is pausing the production of a number of electric vehicle models at its Zwickau plant for an estimated three weeks due to a shortage of electric motors. Volkswagen said it will halt the production of the Audi Q4 E-tron, the Audi Q4 Sportback E-tron as well as the VW ID4 and VW ID5 models in Zwickau. The VW ID3 and Cupra Born models are not affected by the supply bottlenecks and will be produced as planned, it added.

Heretofore, VW was rumored to lay off the floaters at its electric vehicle plant in Germany, given a reduction of European EV orders, insiders unveiled.

Comment:

Tesla, a leading player in the EV market, has put additional pressure on its competitors, including Volkswagen. With its Model Y becoming the best-selling car in September, Tesla's aggressive pricing strategy and high production volumes are reshaping market dynamics. While Europe remains a stronghold for Volkswagen's EV sales, accounting for 61% of its electric models sold through September, the company faces stiff competition and potential market share loss in China until new models are introduced.

                                                                                                                                                                                                                                                    

3. NAND wafer prices rising.

Memory chip makers' strict production cuts have managed to shore up the NAND wafer prices, with module houses scrambling to secure supply.

NAND controller manufacturer Phison warned that an impending shortage of materials used in NAND flash chips is predicted to cause SSD prices to rise, signaling that the days of low-cost NAND flash are coming to an end.

Comment:

Manufacturers have been cutting production to cope with the tumbling demand for SSD since the COVID-19 pandemic, but material shortages could intensify the contraction in supply. At the moment, memory chip makers’ strict shipments will inevitably push up the end-products hike in the face of short supplies.

                                                                                                                                                                                                                                                     

4. Energy storage companies report bumper results in the first three quarters.

In the first three quarters of 2023, China's Photovoltaic installed 128.94 million kilowatts, a surge of 145% year-on-year. Global PV installed capacity hit 240GW, up 60%, and global energy storage shipments stood at 61GWh, a leap of 103%, marking constant prompt growth in new energy.

High electricity prices and mature business models outside of China have brought impressive new energy markets, attracting China’s companies. From the current announcement released by many companies, a number of China’s new energy companies have obtained orders overseas.

Comment:

China, the United States, and Europe are the largest energy storage markets. The installation capacity in the American energy storage market is expected to increase at a compound growth rate of 88.5% during 2023-2025. Chinese energy storage companies will secure more shares in overseas markets, as they endlessly expand their business abroad in the future.

                                                                                                                                                                                                                                                     

5. Vishay to Acquire Nexperia’s Newport wafer fab for $177 million

Vishay Intertechnology and Nexperia today announced that they have entered into an agreement that Vishay will acquire Nexperia’s wafer fabrication facility and operations located in Newport, South Wales, U.K. for $177 million in cash. Wingtech noted that the acquisition would not impact its semiconductor business, because the company's future wafer capacity increase will be realized by the upgrading of production capacity and the expansion of outsourcing at Nexperia's wafer fabs in Manchester and Hamburg.

Comment:

NWF has been the UK's largest semiconductor production hub since 1982, with a focus on MOSFET and IGBT chips for automotive applications, as well as CMOS and analog chips.