Specialist
VP at Digi-Key Corp (Digi-Key Electronics)
Agenda
- Storage easing expectations
- Lead time trends and inventory levels
- Pricing evolution and the impact of inflation
- Impact of Russia-Ukraine conflict, China’s lockdown cycles and potential economic downturn on supply-demand dynamics
- Capacity utilisation and expansion trends and the impact of new capacity investments from key manufacturers such as Samsung (KRX: 005930), Intel (NASDAQ: INTC), TSMC (TWSE: 2330) and others
Questions
1.
What key trends and main shifts in the IC [integrated circuit] supply space since the beginning of 2022 should we follow closely?
2.
You said you were getting inventory since the beginning of summer 2022. If 100% is normal and 0% is the worst stage, so perhaps summer 2021, where are you now in terms of access to inventory or how much inventory you’re getting from suppliers?
3.
Which ICs have the shortest lead times today and which have the longest?
4.
Are the lead times the same across passives, DRAM, display ICs and sensors, etc?
5.
To confirm, you expect lead times to return to normal by Q4 2023?
6.
Which lead times might come down before Q4 2023?
7.
Which chip suppliers would you say are in short supply the most or least overall?
8.
Do any major chip players stand out as having done really well or really badly with managing supply across NXP, Microchip, Renesas, Onsemi, Infineon, TI, STMicro and GlobalFoundries?
9.
To what extent have smaller suppliers been able to take advantage of larger suppliers failing to handle the situation better and take stronger positions in the market? Do you have any particular suppliers in mind or categories they have taken stronger positions in?
10.
How might chip supply trend over H2 2022? Do you expect things to stay the same, so at 40% of normal inventory, as you mentioned?
11.
How would you describe the state of inventories at end customers vs in the channel for major components?
12.
Have supplier guarantee programmes had any impact on double-ordering? Is double-ordering still a feature among customers, and when do you expect it to ease?
13.
Can IC manufacturers introduce any strategies to try and limit demand?
14.
For automotive, how should we estimate double-booking orders from OEMs, and how would you size the scale of double-ordering in the market today?
15.
How would you describe the pricing environment and pricing developments for major IC categories since H1 2022, and how might it trend in H2?
16.
I’ve been hearing potential price increases of between 5% and 10%. Is that in line with what you’ve been observing?
17.
Can manufacturers still be quite aggressive with raising prices throughout H2 2022 and into 2023?
18.
What should we monitor that could impact chip pricing? We’ve obviously got the macroeconomic situation and a potential recession, the deteriorating geopolitical situation between the west and China, and regulations coming in such as the CHIPS [Creating Helpful Incentives to Produce Semiconductors for America] and Science Act and the European Chips Act. How might all this impact chip pricing in H2 2022 and 2023, and how is it different from earlier in 2022 and even 2021?
19.
How permanent do you think price increases could be? Is there a range we can consider for permanent higher pricing, or have the price increases over the past few quarters been more transient than a structural change?
20.
Have any particular suppliers or players been given a competitive advantage by the chip supply-demand imbalances, and if so, why?
21.
In terms of chip suppliers maximising their production, I read that STMicro is essentially fully booked until 2024. How sustainable could it be for chip suppliers to run their fabs at full utilisation and maximum yields? Are there ever any risks associated with that, given it’s such a long period of time?
22.
On making the supply chain more robust, a huge capacity expansion is underway. Players such as Intel and Samsung have announced tens of billions of dollars amounting to hundreds of billions of dollars in capacity expansion of foundries globally. How concerned should we be about overcapacity when all this capacity comes online?
23.
Do you have any thoughts on the state of issues such as labour shortages and logistical bottlenecks, including sea transit times and costs, and whether they have improved since earlier in 2021?
