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  • Apple’s Leap of Faith: Intel Chip Deal Sparks Debate on Future of U.S. Chipmaking Industry

    Apple’s Leap of Faith: Intel Chip Deal Sparks Debate on Future of U.S. Chipmaking Industry

    Apple’s transition to Intel chips, as reported last week, displays a strategic move driven by necessity and ambition. However, industry experts suggest this is not a straightforward transition, as advanced Intel chips typically require two to three years to manufacture. Moreover, the translation of this shift into tangible benefits may take even longer due to the extensive and meticulous production process.

    This potential deal, which has not yet been officially confirmed by either party, could present a mutually beneficial opportunity. Intel has been striving to reestablish its reputation as a credible contract chipmaker, while Apple seeks additional manufacturing capacity. This comes in light of Apple’s current supplier, TSMC, grappling with increased Artificial Intelligence (AI) chip demand led by companies such as Nvidia.

    Supply issues have impacted iPhone sales, as Apple CEO Tim Cook noted in April. The prospective agreement with Intel aligns with the U.S strategy to bolster domestic chip manufacturing, using tariffs and incentives. Intel, holding a 10% stake in the company and having received a $5 billion investment from Nvidia on the request of President Donald Trump, is considered a critical player in this initiative.

    However, Malcolm Penn, CEO of chip research firm Future Horizons, offers a cautious perspective. “The very best-case scenario would see the first chips produced within two to three years. Designing an SoC (system on chip) of this complexity takes two years, with an additional four months needed for production cycle time to ramp up,” he explained. Penn underscores that this estimation is contingent on Intel’s technology being fully developed and its design tools sufficiently reliable for Apple to rely on. He termed the deal as “a shotgun wedding,” due to the high degree of faith and commercial risk involved.

    Intel’s Prospects with Apple

    Despite being late to the AI boom, Intel has made tentative strides, securing Tesla as a customer in April and potentially entering a significant partnership with Apple. Experts are split over which Intel manufacturing process Apple will select.

    While some predict Apple will follow Tesla onto Intel’s forthcoming 14A process, others foresee Apple prioritizing reliability over cutting-edge gains, potentially favoring 18A-P, a refined version of Intel’s most advanced process, or a reliable, older node such as Intel 3.

    Bob O’Donnell, an analyst at TECHnalysis Research, believes Apple might opt for Intel’s 14A process technology, expected to be available by 2028 or 2029. He notes that if this comes to fruition, it would mark a pivotal development for Intel’s foundry business and U.S-based semiconductor manufacturing more broadly.

    Turning Apple’s Vision into Reality

    Daniel Newman, CEO of tech research firm Futurum Group, suggests that the mass production of Apple-designed chips may not commence until late 2027 or early 2028. It is anticipated that initial efforts will concentrate on less critical components used in MacBook Air or certain iPad Pro models.

    Apple might adopt a cautious approach, initially testing Intel with lower-end products before entrusting them with their most essential chips, as per analysts. Intel, which has faced challenges with the timeline and quality of its chips, will need to meet Apple’s high yield expectations—a standard that TSMC has accustomed Apple to.

    Paul Meeks, head of tech research at Freedom Capital Markets, voices skepticism. “Investors are betting on flawless execution by Intel, a company that hasn’t delivered for about 20 years. While Intel seems to have made progress with its latest manufacturing process, we should all at least modestly discount a perfect outcome,” he warned.

    Questions & Answers

    What is the predicted timeline for the production of Intel chips for Apple?
    The best-case scenario predicts that the first chips could be produced within two to three years. However, the mass production of Apple-designed chips may not start until late 2027 or early 2028.

    What factors could impact this timeline?
    The timeline depends largely on whether Intel’s technology is fully developed and its design tools reliable enough for Apple to depend on. It is also contingent on Intel meeting Apple’s high yield expectations.

    What could be the implications of this shift for Apple and for U.S. semiconductor manufacturing?
    The shift could potentially provide Apple with the additional manufacturing capacity it seeks and help Intel rebuild its credibility as a contract chipmaker. If successful, it could also mark a significant development for U.S-based semiconductor manufacturing.

  • Viettel Spearheads Vietnam’s Tech Revolution with Groundbreaking Semiconductor Chip Fabrication Plant

    Viettel Spearheads Vietnam’s Tech Revolution with Groundbreaking Semiconductor Chip Fabrication Plant

    Viettel Group, a Vietnamese multinational telecommunications corporation, has recently launched the initialization phase of building the country’s first semiconductor chip fabrication plant. This ambitious venture, endorsed by the Ministry of National Defense, is a part of a governmental initiative to indigenize chip production capabilities. The project is aimed at developing a comprehensive domestic ecosystem for semiconductor technologies.

    Plant Details and Its Impact

    The prospective plant will be based in Hanoi, within the Hoa Lac Hi-Tech Park, spread across an area of approximately 27 hectares. Its intended purpose is to serve as a national hub for a variety of processes including research, design, testing, and the actual production of semiconductor chips.

    Upon becoming operational, the plant is expected to bolster several national industries, including aerospace, telecommunications, the Internet of Things (IoT), automotive manufacturing, medical devices, and automation, among others.

    Filling the Gap in the Production Process

    The process of creating a fully functional semiconductor chip necessitates six primary stages: product definition, system design, detailed design, chip fabrication, packaging and testing, and integration and testing. To date, Vietnam has engaged in five of these steps, with chip fabrication—the most intricate and crucial stage—remaining unattained domestically. The establishment of the proposed semiconductor chip fabrication plant will enable Vietnam to close this gap, allowing it to complete the full spectrum of the semiconductor chip production process.

    The Prime Minister of Vietnam, Pham Minh Chinh, emphasized the significance of the project, stating that the groundbreaking of the country’s first high-tech semiconductor chip fabrication plant is a momentous event. It signifies a step towards achieving the national strategy for the development of the semiconductor industry and sets the foundation for Vietnam to integrate more deeply into the global value chain through advancements in science, technology, and innovation.

    Training and Workforce Development

    In addition, the plant is expected to function as a practical training center for the semiconductor workforce, merging training with an authentic production environment. As a part of the National Semiconductor Strategy, Vietnam is planning to train 50,000 chip design engineers by 2030, with an aim to cultivate a workforce of over 100,000 individuals in the semiconductor industry by 2040.

    The CEO of Viettel Group, Lieutenant General Tao Duc Thang, emphasized that the plant’s construction would be completed, technology transfer received, and pilot production initiated all by the end of 2027.

    Future Aspirations

    The fabrication plant project will unfold between 2026 and 2030, incorporating plant construction, technology transfer, process perfection, and improved operational efficiency. The project’s long-term vision includes the expansion of the Hoa Lac plant, which would provide a platform for Vietnam to gradually access more advanced semiconductor technologies.

    The launch of this high-tech semiconductor chip fabrication plant is a significant step in Vietnam’s journey towards building technological capabilities, contributing to the country’s objective of technological self-reliance and lasting sustainability.

    Questions & Answers

    What is the purpose of the semiconductor chip fabrication plant?
    The plant will serve as a national hub for research, design, testing, and production of semiconductor chips, supporting numerous national industries.

    What is the timeline for the plant’s construction and operation?
    The plant is expected to be constructed, receive technology transfer, and begin pilot production by the end of 2027. The period from 2028 to 2030 will focus on process optimization and efficiency improvements.

    How will the plant contribute to workforce development in Vietnam?
    The plant will also serve as a practical training center for the semiconductor workforce, attempting to train 50,000 chip design engineers by 2030, and aim for a workforce of over 100,000 in the industry by 2040.

  • Apple Challenges Qualcomm With In-house Modem In New M5 Ipad Pro

    Apple Challenges Qualcomm With In-house Modem In New M5 Ipad Pro

    Apple’s most recent M5 iPad Pro has been unveiled, exhibiting yet another relatively insignificant, ‘chip-and-ship’ upgrade that most users are likely to bypass. However, the real point of interest is the modest addition of an in-house cellular chip, marking a critical step in Apple’s ongoing rivalry with Qualcomm.

    What’s New in the M5 iPad Pro?

    Similar to the latest MacBook releases, the M5 iPad Pro was launched without much fanfare, primarily featuring a processor enhancement. According to expert observations, the device only boasts ‘modest improvements’ beyond the M5. The preceding M4 iPad Pro is already a powerful tool, and as such, the day-to-day experience for M4 iPad Pro users is unlikely to differ significantly with this update.

    The most notable adjustment, certainly for those within the industry, is not the M5 itself. Instead, the focus is on the newly incorporated C1X cellular modem, an in-house development replacing the third-party component previously utilized by Apple. Additional features include a new N1 chip for Wi-Fi 7 and faster external display support, though these are generally considered minor, specialized upgrades.

    The Importance of the Modem

    On the surface, the average consumer may not be particularly concerned with a modem. However, for Apple, it is of significant importance. The ‘third-party component’ that Apple has recently abandoned was supplied by Qualcomm. Those well-versed in the tech industry are likely aware of the protracted and complicated legal battles between Apple and Qualcomm over patents and licensing fees.

    Beneficial for Apple, not the Consumer

    This update is a quintessential ‘Apple’ move. It represents an enormous business and technical victory for the company, but it offers little to no benefit to the average consumer. Switching to in-house components is a strategic business decision for Apple, but it has yet to noticeably impact the user experience.

    Moreover, it should be noted that the majority of iPad purchasers opt for the Wi-Fi only model, rendering this new chip inconsequential for most customers. The introduction of this chip does not affect the purchasing decision in any significant way. The real test will come when these in-house modems are incorporated into iPhones. That’s when performance must be flawless, and when Qualcomm will truly start to feel the pressure. For the time being, this is just a subtle, strategic move by Apple.

    Questions & Answers

    What is the most significant upgrade in the M5 iPad Pro?

    The most significant upgrade in the M5 iPad Pro is the addition of an in-house C1X cellular modem, replacing the third-party component previously supplied by Qualcomm.

    Does the new in-house C1X cellular modem affect the consumer experience?

    No, the switch to in-house components, including the new modem, has not yet led to a noticeable change in the user experience.

    What is the potential impact of the in-house modem on Apple’s relationship with Qualcomm?

    The introduction of an in-house modem indicates a strategic move by Apple that could put pressure on Qualcomm, particularly when in-house modems begin to be incorporated into iPhones.

  • Apple To Revolutionize Mixed Reality With Next-gen Vision Pro 2: New Chip, Enhanced Performance

    Apple To Revolutionize Mixed Reality With Next-gen Vision Pro 2: New Chip, Enhanced Performance

    Apple’s Vision Pro, rather than relying solely on one chip for power, utilizes both the M2 and the R1 chips. In a recent development, reports suggest that Apple plans to incorporate the R2 chip in the next iteration of its premium Mixed Reality (MR) headset, adding a new feature to the device’s already impressive specifications.

    Delayed Announcement

    The successor to the Vision Pro was initially anticipated to be unveiled this month, along with the iPhone 17 series. To the disappointment of many MR aficionados, this did not occur, as the event was exclusively dedicated to the launch of the newly redesigned phones. Many speculate that the delay in the headset’s announcement is due to the incorporation of the R2 chip, pushing the launch to next year.

    Towards A More Capable Headset

    The new R2 chip is said to be created using TSMC’s 2 nm process, a significant advancement from the R1 chip. Combined with the M4 processor — speculated to be part of the new headset — the Vision Pro 2 promises to deliver significantly enhanced performance. The R-series chips are designed to work in sync with the M-series processor, managing the input from the headset’s numerous sensors and cameras. This functionality made the Vision Pro a feature-packed device, a contributing factor to its steep price tag of $3,499.

    The 2 nm R2 chip is expected to process these inputs even quicker, thereby enabling the new Vision Pro to support more complex applications. However, this improvement might not be noticeable for an average user. The general performance will be significantly improved, but not necessarily in a discernible manner.

    Staying Relevant in the XR Industry

    The new Vision Pro headset is primarily intended to ensure Apple’s relevance in the Extended Reality (XR) industry. The key ambition for the company is the development of AR smart glasses, with the aim to outpace Meta in the market. Recently, the new Meta Ray-Ban Display smart glasses were unveiled. While these glasses don’t offer true AR, they mark the company’s entry into the AR market, reminding Apple to reiterate its commitment to XR devices.

    Questions & Answers

    What significant changes are expected in the successor to the Apple Vision Pro?
    The successor is expected to incorporate the R2 chip, which is a significant enhancement from the R1 chip used in the current model.

    What is the speculated release date for the successor to the Vision Pro?
    The release is projected to be delayed till next year, due to the proposed incorporation of the new R2 chip.

    Why is Apple developing the new Vision Pro headset?
    The new Vision Pro headset is primarily a measure to maintain Apple’s presence and relevance in the rapidly growing Extended Reality (XR) industry.

  • Revolutionary New Chip Boosts AI Network Efficiency with Lightning-Fast 102.4-Tbps Speed

    Revolutionary New Chip Boosts AI Network Efficiency with Lightning-Fast 102.4-Tbps Speed

    In a bold step toward revolutionizing the realm of artificial intelligence, Broadcom has unveiled the Tomahawk 6, a state-of-the-art Ethernet switch chip boasting an impressive bandwidth of 102.4 Tbps. This innovation is set to become a cornerstone of large-scale AI workloads, unlocking the potential for organizations to harness the power of expansive AI clusters.

    A New Era for AI Infrastructure

    What sets the Tomahawk 6 apart is its capability to support over a million auxiliary processing units (XPUs) in sprawling scale-out architectures, effectively doubling the bandwidth available compared to previous offerings. This leap in technology is more than just numbers; it paves the way for unprecedented computational power in AI applications.

    Advanced Features for Seamless Performance

    The chip comes equipped with advanced features, including 100 Gbps and 200 Gbps SerDes, co-packaged optics, and enhanced routing software designed for real-time congestion management. Not one to shy away from energy efficiency, Tomahawk 6 integrates long-reach passive copper support, reducing power consumption while also minimizing latency through sophisticated telemetry and adaptive routing systems.

    Simplifying Connectivity with Open Standards

    One of the key advantages of the Tomahawk 6 is its compatibility with standard Ethernet networks and multiple network topologies, simplifying the scaling process without the need for proprietary systems. Its adherence to open standards, such as those championed by the Ultra Ethernet Consortium and the newly established Scale Up Ethernet (SUE) Framework, signifies a strong commitment to fostering a more accessible technology landscape.

    Meeting the Demands of Generative AI

    As the demand for generative AI (GenAI) training, inference, and fine-tuning continues to surge, the Tomahawk 6 positions itself as a critical player in meeting these challenges. Broadcom has already lined up several large-scale deployments, with plans that include configurations featuring over 100,000 AI accelerators operating in production environments. This chip doesn’t just represent a technological upgrade; it embodies a significant shift in how industries may approach AI scalability.

    Questions & Answers

    How does Tomahawk 6 improve AI cluster performance?
    With its ability to support more than a million XPUs and deliver 102.4 Tbps bandwidth, Tomahawk 6 significantly enhances the performance and scalability of AI clusters.

    What advanced features does the Tomahawk 6 include?
    The chip features 100 Gbps and 200 Gbps SerDes, co-packaged optics, and advanced routing software for real-time congestion control, all designed to optimize performance while minimizing latency.

    Why is compatibility with open standards important?
    Being compatible with standard Ethernet networks and open standards ensures that the Tomahawk 6 can be easily integrated into existing infrastructure, allowing for flexible scaling and widespread adoption without being locked into proprietary solutions.

  • Apple chip builder TSMC not yet ready to move to next-gen lithography system

    Apple chip builder TSMC not yet ready to move to next-gen lithography system

    Back in December, Dutch tech giant ASML shipped its first High-NA Extreme Ultraviolet (EUV) lithography machine (EXE:5000) to Intel. The $400 million machine will take us to the next tier of chip production with a process node of 2nm and less. The original EUV machines, also made by ASML, were necessary to get chip foundries to manufacture components under 10nm. A lower process node means smaller transistors, meaning more can fit inside a chip. The higher a chip’s transistor count, the more powerful and/or energy efficient it is.

    The reason that the EUV machine is so important is that it prints circuitry patterns on silicon wafers that are thinner than human hair. This is required when you are building a chip with billions of transistors inside. The 7nm A13 Bionic SoC, used to power 2019’s iPhone 11 series, contained 8.5 billion transistors. The 3nm A17 Pro used to run the iPhone 15 Pro and iPhone 15 Pro Max sports 19 billion transistors.

    The 8 nm resolution of the EXE:5000 means that chipmakers can pack more transistors into a single chip. Smaller transistors are more energy efficient – that means the chips will be able to do more with less.-ASML

    The new High-NA EUV machine has a 0.55 numerical aperture (NA) lens giving it a resolution of 8nm compared to the current machines’ resolution of 13nm (.33 NA). This means that the new machines can print transistors 1.7 times smaller resulting in transistor densities 2.9 times larger with a single exposure. The result? More powerful or energy-efficient chips. The new machines can also print 185 wafers per hour, rising to 220 by 2025. That compares to the 160 wafers per hour that can be printed with the current EUV machines.

    The current Low-NA EUV machines can produce the same resolution but only after two exposures are made using double patterning. However, there are risks with double patterning including longer production times, and increased risk that a defect will occur. It can also lead to performance variability among manufactured chips.

    ASML is quick to tell you what can go wrong with double patterning since it would prefer foundries spend the bigger bucks on the newer machines. But TSMC’s N3B process node, which supposedly relies on double patterning, was used to manufacture the A17 Pro application processor used on all of those iPhone 15 Pro and iPhone 15 Pro Max units made by Apple, and the M3 chip used to power high-end Macs. ASML says that its clients are just now doing their research into the High-NA EUV.

    Financial institution China Renaissance (via

    Eventually, TSMC, Samsung Foundry, and others will have to join Intel and start making the investments needed to move to the High-NA EUV. That time might end up being soon with TSMC and Samsung looking to start 2nm production in 2025 moving to 1.4nm production in 2027.

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  • Vietnam third top chip exporter to the US

    Vietnam third top chip exporter to the US

    Vietnam accounted for 10% of semiconductor chip exports to the U.S. in the 12 months ending this February, ranking third after Malaysia and Taiwan.

    The Vietnam chip industry’s revenue from the U.S. market rose by 74.9% during the period, from $321.7 million in February 2022 to $562.5 million this February, according to a report by the Ministry of Information and Communications.

    Vietnam is also among the countries with the highest growth rate of chip exports to the U.S., alongside Thailand, India and Cambodia.

    Cambodian chip exports to the U.S. grew in value 7-fold over the period, from $20.8 million to $166.3 million, while Indian revenues from the market grew 34-fold to $152 million in February.

    In February, semiconductor chip export orders to the U.S. reached $4.86 billion, up 17% year-on-year. Among those, chips made in Asia accounted for 83%.

    Bloomberg reported that the U.S. is diversifying its electronics supply chain by reducing the share of chip imports from Malaysia, a longtime powerhouse in chip packaging, alongside moving its iPhone production chain out of China.

    At a government meeting in April, Prime Minister Pham Minh Chinh assigned the Ministry of Planning and Investment the tasks of improving the National Innovation Center, and developing a chip production program.

    Experts believe Vietnam has the potential to be a global center of chip production if it can utilize its advantages and implement effective strategies, policies, and incentives for the sector.

    Intel’s Asia Pacific and Japan General Manager Steve Long told VnExpress last year: “Vietnam can establish the necessary infrastructure and policies to support cutting-edge chip manufacturing.”

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  • Chip shortage is still a thing says Intel CEO Gelsinger

    Chip shortage is still a thing says Intel CEO Gelsinger

    Just because we don’t constantly hear about it as much anymore doesn’t mean that the global chip shortage has ended; when it comes to chips, the world isn’t all of a sudden “in the chips,” according to Intel CEO Pat Gelsinger who spoke Friday on CNBC’s “TechCheck.” The executive says that important tools used in the chip manufacturing process are not readily available keeping production capacities in check.
    With foundries unable to expand production capacity for their fabs, Gelsinger sees the chip shortage lasting longer than originally thought. “That’s part of the reason that we believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged,” the Intel CEO said.

    Intel, which has promised to regain “process performance leadership” by the end of 2024, has created a road map that includes taking delivery of ASML’s next-generation extreme ultraviolet lithography (EUV) machine. The $150 million machine uses highly polished mirrors to help focus ultraviolet light allowing it to etch circuitry patterns onto a wafer.
    With billions of transistors deployed on chipsets these days, lithography machines need to be able to create patterns that are fractions of the width of a human hair to help foundries manufacture cutting-edge chips. Intel will be the first foundry to use the new machines that raise their numerical aperture from .33NA to .55NA. This means that the machine can collect more light to help it create the circuitry patterns on the wafers that are used to build faster and more energy-efficient integrated circuits.
    Returning to process leadership means that Intel has to continue spending to build new fabs in the U.S. and Europe. The executive says, “We’ve really invested in those equipment relationships, but that will be tempering the build-out of capacity for us and everybody else, but we believe we’re positioned better than the rest of the industry.”
    Before speaking on CNBC, Gelsinger previously said that a supply-demand balance in the chip industry would take place in 2023. Intel did report first-quarter revenue and earnings last week that topped expectations on Wall Street although its estimates for the second quarter came in below analyst’s forecasts. Over the last week, Intel’s shares declined 8.6% from $93 to $85.
    The top two contract foundries in the world that take chip designs created by other companies and turn them into the final components are TSMC and Samsung. The former is known for building the chips designed by Apple including its A-Series and M-Series chips. Unlike TSMC and Samsung, Intel’s foundries usually produce components that Intel itself had designed.
    With two new fabs being built in Arizona, Intel is taking the business model perfected by TSMC and is bringing it to the U.S. But that doesn’t mean that TSMC won’t be a competitor. The Taiwan-based company is building its own plant in Arizona that will turn out 5nm chips by 2024.
    Tech firms are expected to embrace the possibility of having Intel produce chips based on their designs without fear that a geopolitical event will force TSMC to shut its factories in Taiwan and create a massive bottleneck that would make the current chip shortage feel like a walk in the park.
    Creating a valid supply chain for chips in the U.S. and making the country self-sufficient is a goal that the U.S. has been trying to achieve. China too has a goal to become self-sufficient when it comes to building chips. After the U.S. used its export rules to block Huawei from receiving shipments of cutting-edge chipsets, this became a major goal for the country.
    In 2020, the U.S. Commerce Department put in place a rule that blocks foundries that use American technology to build advanced chips from shipping such chips to Huawei even if the chips were designed by the company itself.
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  • Samsung seeks to supply Apple with an important part of the latter’s M2 chip series

    Samsung seeks to supply Apple with an important part of the latter’s M2 chip series

    Apple’s initial line of M-series chips includes the M1, M1 Pro, M1 Max, and the M1 Ultra. Built by TSMC using its 5nm process node, these SoCs feature a large number of transistors starting with the M1’s 16 billion and moving ahead to the 33.7 billion on the Pro, 57 billion on the Max, and the whopping 114 billion on the Ultra (which is essentially two M1 Max chips combined.
    The M-series chips are based on Arm’s architecture and the M1 is employed inside the latest versions of the iPad Pro and iPad Air. Apple has finished the M1 series and is now moving on to the M2. One of Apple’s main rivals says that it wants a role in Apple’s M2 supply chain. Samsung, which was involved in the production of the M1 series, wants to continue peddling supplies to Apple for the M2 series.
    According to SamMobile, Samsung supplied Apple with FC-BGA (full-chip ball grid array) substrates that are used by CPUs and GPUs that have a large number of circuit connections. A substrate used in the production of chips is basically a thin copper wire placed in resin that helps transmit user instructions to chips and relay the answers. It is used because the extremely thin wiring attached to chips can’t handle being soldered directly to a circuit board.
    In other words, a substrate helps connect a chip to the motherboard of a device. As important a task as that is, it is not as high tech as other parts of a chipset are and margins are low.
    Last December, Samsung invested 1.3 trillion Korean won ($1.04 billion USD) to build an FC-BGA substrates factory in Vietnam. The company also spent another 300 billion won ($241 million USD) on its existing FC-BGA substrates facility in its home country of South Korea.
    Will Samsung get the job? Considering that there has been under-investment in the production of substrates (typical for such a low-margin business), supplies are tight and Apple has been known to tie up production for years in situations like this. And if Apple doesn’t go with Samsung, there are many chipmakers that need to find a source for advanced substrates.
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  • BMW’s CEO Expects Chip Shortage To Last Into 2023

    BMW’s CEO Expects Chip Shortage To Last Into 2023

    A shortage of semiconductors is likely to remain a problem for the auto industry into 2023, German carmaker BMW’s Chief Executive Oliver Zipse said in an interview with newspaper Neue Zuercher Zeitung (NZZ) published on Monday.

    “We are still in the height of the chip shortage,” Zipse was quoted as saying. “I expect us to start seeing improvements at the latest next year, but we will still have to deal with a fundamental shortage in 2023.”

    BMW said during its annual press briefing in mid-March that it expected the chip shortage to last throughout 2022.

    Zipse’s comments echoed similar statements by Volkswagen’s CFO Arno Antlitz on Saturday who said he expected that supply of chips would not be able to meet demand until 2024.

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  • Chip Undersupply To Last Until 2024, Says Volkswagen CFO Boersen-Zeitung

    Chip Undersupply To Last Until 2024, Says Volkswagen CFO Boersen-Zeitung

    Semiconductor chip supply is unlikely to be enough to completely satisfy demand again until 2024, Volkswagen Chief Financial Officer (CFO) Arno Antlitz said in an interview with German daily Boersen-Zeitung on Saturday.

    He said that although bottlenecks would likely begin to ease towards the end of this year, with production returning to 2019 levels next year, this would not be enough to meet heightened demand for the chips.

    “The structural undersupply will likely only resolve itself in 2024,” Antlitz said.

    A lack of wire harnesses from Ukraine was also still causing some shifts to be canceled, Antlitz said, even as the company was establishing new supplier relationships to source the component from other countries.

    Asked about how funds from a possible IPO of Porsche AG, planned for the end of the year, could be used to bolster Volkswagen’s finances, Antlitz said the money could help fund the carmaker’s software unit and its battery production plans.

    “Only those who can map out their battery supply chain have the advantage at scaling in electromobility. Securing the supply chain comes with that. A Porsche IPO could give us a lot more flexibility in financing this,” Antlitz said.

  • Bosch To Invest Additional 250 Million Euros In Chip Production Capacity

    Bosch To Invest Additional 250 Million Euros In Chip Production Capacity

    Bosch is investing an additional 250 million euros ($282.50 million) in extending chip production facilities at its Reutlingen plant in Germany, the company said on Tuesday.

    The Reutlingen site had previously been earmarked for 50 million euros of a total of 400 million that the supplier set aside last year for spending on chip production in 2022 across Reutlingen, Dresden and a testing facility in Penang, Malaysia.

    The largest part of that budget was allocated to expanding its 1-billion-euro Dresden factory producing 300-millimeter wafers, which the group inaugurated in June.

    The extra capacity at Reutlingen will come into force in 2025, Bosch said in a statement.

  • Czech Car Production Falls 11% In January As Chip Shortage Weighs

    Czech Car Production Falls 11% In January As Chip Shortage Weighs

    Czech passenger car production fell by 11.4% year-on-year to 92,657 vehicles in January, posting its lowest result for that month since 2010 as the chip shortage continued to weigh, the Czech Automotive Industry Association (AutoSAP) said on its website on Thursday.

    AutoSAP said, though, it expected the situation to stabilize in 2022 and show a rebound in full-year figures.

  • EV Battery Giant LG Energy Solution Sees Demand Rising As Chip Shortage Eases

    EV Battery Giant LG Energy Solution Sees Demand Rising As Chip Shortage Eases

    Battery maker LG Energy Solution Ltd (LGES) said on Tuesday it aims to boost sales by about 8% in 2022, forecasting a pick-up in demand for electric vehicle (EV) batteries as a global chip shortage eases later this year. The newly listed South Korean firm, which accounts for a fifth of the global EV battery market, swung to profit in the October-December quarter, even as the chip shortage affecting automakers led to weaker than expected demand for batteries.

    LGES, which became South Korea’s second-largest listed firm last month in the country’s biggest ever IPO, posted an operating profit of 76 billion won ($63.5 million) for the fourth quarter, it said in its maiden earnings report. That compares with a 150 billion won profit estimate by two analysts polled by Refinitiv and a loss of 479 billion won in the same period a year earlier.

    Analysts noted that the global chip shortage has affected demand from automakers, with LGES rivals SK On and Samsung SDI Co Ltd reporting a similar impact on battery demand in the fourth quarter.

    Revenue at LGES, which supplies Tesla Inc and General Motors Co among others, rose 2% to 4.4 trillion won from a year earlier. The company said it has set this year’s capital expenditure budget at 6.3 trillion won, up 58% from a year earlier, to finance capacity expansion at its global manufacturing facilities to meet demand for batteries.

    “LGES will continue to move forward with bold investment plans needed in the long run. We are confident our business model of preparing for the future will definitely help us lead the industry,” LGES chief executive officer Youngsoo Kwon said in a statement.

    LGES made a stellar market debut in late January, surging to a market capitalisation of about $98 billion, second only to Samsung Electronics Co Ltd on the local bourse, reflecting upbeat prospects for EV battery industry. The company’s shares have since risen 8.5% and added a further 2.2% on Tuesday, ahead of a 0.8% rise in the broader market KOSPI. Asked during an analyst conference call about more battery joint ventures with automakers, LGES said it had held working-level discussions with Japan’s Honda Motor Co Ltd about a potential joint venture, but there was no concrete agreement on a deal.

    Revenue at LGES, which supplies Tesla Inc and General Motors Co among others, rose 2% to 4.4 trillion won from a year earlier

    In January, a South Korean local newspaper reported that LGES planned to build a battery joint venture with Honda in the United States. LGES said in late January that it plans to invest a total of $2.6 billion with GM to build their third joint battery plant in the United States, aiming to secure an annual capacity of about 50 gigawatt hours (GWh) of batteries by 2025, enough to power about 700,000 EVs. The two companies are already building two joint battery plants in Ohio and Tennessee.

    Global EV sales, estimated at 2.5 million vehicles in 2020, are forecast to grow more than 12-fold to 31.1 million by 2030 and account for nearly a third of new vehicle sales, according to consulting firm Deloitte.

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  • Toshiba To Invest $1 Billion To Double Power Chip Production

    Toshiba To Invest $1 Billion To Double Power Chip Production

    Toshiba Corp said on Friday it will invest about 125 billion yen ($1.09 billion) to more than double the production of power management semiconductors, aiming to catch up with power chip giants such as Infineon Technologies AG.

    The Japanese industrial conglomerate will build a cutting-edge 300-millimeter fabrication plant in central Japan for power management chips, which efficiently control electric power in cars, electronic devices, and industrial equipment.

    Toshiba will invest around 100 billion yen in the new plant, on top of a 25 billion yen investment in a 300-millimeter fabrication line it is building at an existing chip plant, a Toshiba spokesperson said.

    The new plant is set to start operating by March 2025. When the first phase is complete, Toshiba’s power chip output capacity would be 2.5 times its current level. Depending on demand, the new plant could further expand with additional investment, the spokesperson said.

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