Chaos After Global "Lack Of Core": Some Channel Vendors Bid Up Prices And The Test Of Downstream Manufacturers Intensifies

? ? ? A report from a downstream LED display product manufacturer to an upstream IC product supplier once again reveals the chaotic situation among industries under the global core shortage environment.

On August 12, the official micro signal of blue chip, a manufacturer of LED electronic display, sent a real name report to fullman electronics, claiming that the latter was suspected of abusing its dominant market position to monopolize the relevant chip market, It has submitted to the China Optical and Optoelectronic Industry Association and the antimonopoly Bureau of the State Administration of market supervision and administration of the people's Republic of China.

Dai Zhiming, chairman of Lampu video, told the 21st century economic reporter that "excessive price hikes have affected many led peers, and we have also suffered a severe blow, and the operating costs are high. Some customized models of IC products have to be transferred to the supply chain, which involves complex debugging and other processes. At the same time, some customer orders have to be adjusted, and it takes 2-3 months to solve the relevant problems, which brings losses to the company. "

On the one hand, under the condition of out of stock and unable to quickly replenish the output value in a short period of time, the supplier will increase the price, which is a normal business logic choice, which appears in many upstream large factories, including wafer factories with short capacity but increasing orders; However, on the other hand, the excessive and rapid price rise of some intermediate links is also the performance witnessed in the industry, and to some extent, has become a participant in the aggravation of the core shortage environment.

A number of industry insiders have expressed similar observations to reporters, that is, some people deliberately hoard goods and bid up prices in the market. It can be seen that some abnormal price increases on the market, and even the improper behavior of some middlemen, will have a certain impact on the downstream industrial companies and even the entire domestic electronics industry ecology.

Since 2020, LED driver chip market is facing a sharp contradiction between supply and demand, and related manufacturers have issued price increase letters. Visual China

LED driver in demand

Under the current situation of global core shortage, the prices of some popular products have increased, which should have been a normal business decision. Just like being in a market that is extremely short of supply, the one with higher price will undoubtedly become a way out under the market-oriented environment.

However, the focus of attention this time is that many practitioners, including the above-mentioned whistleblowers, believe that the price rise is "too much".

"Under normal circumstances, the shortage of goods in the industry is true and the supply is tight. We can understand the rise in prices. But the key is that if, because of the shortage of goods, let the price rise become a habitual action, and become the action force of midstream enterprises to make money, it will go wrong. " An electronic industry chain channel source told the 21st century economic report that he was concerned that the price increase released by the original chip manufacturers in Europe and the United States was not as large as that claimed by some domestic manufacturers. This is the reason why he thinks it is "abnormal".

The LED driver chip mentioned by the core was originally a very popular product category on the market. Soochow Securities pointed out that led driver chip refers to the electronic device that drives LED light or LED module to work normally. Because it has an important impact on the performance of the whole machine, it is known as the "brain" of LED devices.

According to the analysis of Soochow securities, the contradiction between supply and demand of semiconductors is still sharp, and with the advent of the third quarter industry peak season, the tension between supply and demand may continue. Among them, LED driver chip is in the forefront of the current wave of semiconductor shortage and price rise.

According to the statistics of the agency, since 2020, the LED driver chip market is facing a sharp contradiction between supply and demand, and relevant manufacturers have successively issued price increase letters. For example, Jingfeng Mingyuan issued a price adjustment notice, saying that the upstream raw material costs continue to rise, the wafer plant and packaging test capacity are tight, and the production cycle is long. All aspects of product manufacturing are facing extremely tight market demand. Since July 1, 2021, the product price will be adjusted to different degrees according to the specific product model; The company announced the price adjustment of LED lighting drive products from June 1, 2021; Yibiwei announced that the product price will continue to be adjusted on May 7, 2021; Fuhong Chuangxin announced on May 6, 2021 that the price of LED lighting drive products will increase by 10% - 30%.

The reported fullman electronics is facing similar doubts. It is understood that the price of Fuman electronic's IC products has increased considerably, from 0.27 yuan to 1.4 yuan. Based on this calculation, the price has increased about four times.

"Due to the shortage of production capacity, the price increases of IC driven by the market are generally around 20% and 30%, and some of them have increased by 40% this year. To a certain extent, it is also within the reasonable scope. The upstream wafer cost is also on the rise. (chip price increase) is justifiable, but the unreasonable price increase has caused harm to the industry." Dai Zhiming said.

"In recent years, fullman electronics and its designated companies have been responsible for the supply of integrated circuit IC products required for the LED display products of BLUP video," said Lampe video in the aforementioned complaint letter. In the past few months, fullman electronics repeatedly refused to perform the IC product supply contract without justifiable reasons, and constantly asked for price increases, which caused great harm to the normal business activities of Lampu video, seriously affected the production schedule of Lampu video, the timely performance of subsequent orders and the friendly relationship with downstream customers, and seriously squeezed the market survival space of Lampu video. "

In this regard, on August 13, fullman electronics responded on the investor interaction platform: "the company does not have a direct supply relationship with LAMPO video, and the company will take relevant legal measures to report the company's matters."

As for Fuman electronic's statement, Dai Zhiming said that he would respond to this further in the near future, and would disclose the original contract and speak with evidence.

Chaos in the middle and upper reaches

As early as July 8, Lampe video sent out a proposal, saying that the company would unite with small and medium-sized display enterprises to class sue a certain GEM listed IC packaging enterprise, and would provide 1 million yuan as legal aid fee.

"Since the issue of our proposal, 89 colleagues have provided some evidence. Most of them are agents or trading companies because they are not very large in size. " He also said, "this industry needs someone to speak up. The process involved in the transaction of LED display chip industry is relatively complex. There are original factories, service companies and agents in the middle. Does the original factory also have some responsibility? Look at the information disclosed by fullman electronic semi annual report, I believe you can analyze it. After all, agents are like 4S shops of automobile brands. "

Some channel operators have been suffering from this continuous price rise and their "forced" participation for a long time. A channel businessman told the 21st century economic reporter, "we are also very sad." He added that since the beginning of this year, his platform has received complaints from engineers when buying samples, saying that some products could not be purchased“ Later it was found that it was swept away by other people. As a result, there are more and more out of stock varieties on our shelves. "

According to his analysis, there are likely to be some speculators in the market, which may disrupt the prices of some categories by clearing up the competing products of the same type on the market.

The impact will be continuous. In view of the current high price sentiment in the market, they are now more cautious about purchasing goods because of the fear that the follow-up demand will be advanced in advance, the channel merchant told reporters“ At present, we can only buy and sell at a high price from the original factory. In this case, we can only say that at present we need to purchase more controlled goods. In the past, we purchased more goods and then sold them slowly, but now we are afraid that if we buy them at a high level, we will not be able to sell them and then we will fall into our hands. "

Dai Zhiming also told reporters: "what we can see now is that many manufacturers in the LED industry are hoarding goods, and they still make a little more every month to offset the pressure of price rise. But now that the price of IC has risen to this position, supply and demand are tending to be stable, and there are also some phenomena of inventory release and module dumping. The market has signs of callback."

In fact, in recent years, the demand of LED industry has been stable. The driving IC chips required are low-end chips, which can be provided by mature process. However, the most urgent problem in the market is the mature capacity, resulting in the core shortage of downstream terminal manufacturers. At the same time, panic hoarding, speculative speculation and other factors exacerbated the imbalance between supply and demand. With the subsequent release of capacity and multi-party adjustment, the market will gradually squeeze the bubble, and the problem of chip structural shortage will exist, but there is also the risk of partial excess prompted by industry insiders.

Some people in the chip industry told the 21st century economic report that the chip market is now in a chaotic stage, and the phenomenon of agents' rising prices and investing in speculation has existed since the beginning of the year. Some of the original manufacturers did not raise the price a lot, and it is strictly prohibited for agents to speculate. However, some agents or investors store up their products and then sell them at several times or even dozens of times. In the current market, price increases from 10% to 30% are common, and it is common to see several times more. However, the more cruel reality is that some enterprises can't buy chips by increasing prices.

From the overall performance, in fact, at the beginning of 2020, when the new crown pneumonia epidemic led to high enthusiasm for components such as infrared sensors, there was a certain phenomenon of "speculation", which made a group of people gradually taste the sweetness.

"Not only led driver chips, but also automotive grade MCUs and high-power MOS transistors, especially products from large factories such as Ti, are also in demand in the market He said that the reason why MCU and other categories continue to be in demand is that it is difficult to replace them in the short term“ It usually takes more than months or even as long as half a year for such products to go through the process of design and verification, and it also needs to obtain the certification of various countries or regional markets, so the whole commercial cycle is relatively long. "

In this context, for downstream manufacturers, the biggest impact should be small and medium-sized enterprises. Due to the limitation of its own scale, it does not have too high discourse power with the upstream manufacturers, which is prone to passive response.

"From our platform, we can only see the demand of some small and medium-sized downstream enterprises, which is obviously suppressed." The above-mentioned channel operators also told the reporters of the 21st century economic report that compared with large enterprises, they have relatively strong resistance, and small and medium-sized enterprises are not able to bear the cost. Some price hikes in the market will directly affect the following production and operation capacity of such enterprises.

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