Jeffrey Bauza is an entrepreneur in Weldon Spring, MO, a Suburb of St. Louis County, and business writer for several news outlets. In the article below Jeffrey Bauza explains what new developments are happening in the semiconductor market.
The United States has been in a technology race with China for decades. It may become even more competitive.
Jeffrey Bauza reports that Congress has launched negotiations on a measure that would approve and fund $52 billion in subsidies for semiconductor manufacturing in America. The funding would provide a significant boost to the United States as it competes closely with China for semiconductor industry supremacy.
The latest round of negotiations may finally lead to a compromise on the measure, which Jeffrey Bauza says could bolster chip production in the United States after a lingering chip shortage has had a huge impact on the American electronics and automotive industries.
A version of the semiconductor bill was passed by the Senate in June 2021, and one was passed by the House in February. Jeff Bauza says without final action in Congress, U.S. chip production may continue to be at risk, especially compared to other countries around the world, including Germany, that have approved chip industry initiatives of their own.
Jeffrey Bauza explains that the measure may be close to approval. The previous House bill approved $52 billion in funding for chips but did not agree with the Senate on provisions for other technologies. It also outlines trade proposals as well as sanctions against China that did not appear in the Senate’s version.
In March, the White House hosted a meeting between President Joe Biden and semiconductor industry senior executives to discuss prioritizing bolstering the United States’ semiconductor production capability.
Rambus to Acquire Design Firm Hardent
Jeffrey Bauza reports that Rambus, a San Jose, California-based leading chip and silicon technology designer and licensor, has announced that it has signed on the dotted line to acquire electronic design company Hardent.
The move will help Rambus accelerate the creation of CXL-based processing solutions to meet the increasing demand for the company’s products, especially those falling under the CXL Memory Interconnect Initiative. Hardent President and Founder Simon Robin called Rambus’ technology leadership a perfect fit for the company.
Jeffrey Bauza says the deal will also make Hardent’s IP and services to Rambus’ own expanding IP portfolio, especially within consumer electronics and automotive industry applications. Rambus has been a leader in the semiconductor industry for more than three decades, responsible for innovations that have supported data needs around the world.
Jeffrey Bauza: Semiconductor Sales up 23% Worldwide
Sales of semiconductors worldwide reached $151.7 billion in the first quarter of 2022, up 23% compared to the same period last year.
In March alone, global semiconductor sales hit $50.6 billion, according to sales figures gathered by the World Semiconductor Trade Statistics and released by the Semiconductor Industry Association. However, 2022 first-quarter sales are down .5% compared to the last quarter of 2021.
Sales in the Americas were strong. In March, Jeffrey Bauza reports United States semiconductor sales led regional markets and increased over 40% compared to last year. Other high increases in sales were seen in Europe (up 25.7%), Japan (20.4%), and China (17.3%).
Intel CEO Estimates 2 More Years of Chip Shortages
Jeffrey Bauza explains that the global semiconductor industry will continue to feel the pain of supply shortages through 2024, according to Intel CEO Pat Gelsinger.
Talking with CNBC’s “TechCheck,” Gelsinger cited the lack of access to vital manufacturing tools as the major roadblock for the industry which is coping to meet increased demand. Gelsinger, who began his tenure as Intel CEO last year, had previously expected the shortage to come to an end in 2023.
Gelsinger’s company is reportedly feeling the pain, too. The chipmaker’s latest forecast of its second-quarter earnings fell below expectations, but its first-quarter finances were above Wall Street estimates.
Demand for semiconductors continues to gruel, fueled by an increasingly digital world and widespread integration of chips in phones, appliances, and cars. The COVID-19 pandemic has also contributed to the shortage through factory disruptions.
Chip Shortage Impacts Hyundai Sales
Citing a global chip shortage for slowing production of vehicles, Seoul-based Hyundai Motor says its sales dropped 12% in April compared to the previous year. Sales at Kia, owned by Hyundai Motor, were down 5.5%.
Jeffrey Bauza reports overseas Hyundai sales dropped 11% compared to 2021, and overseas Kia sales fell nearly 7%. Hyundai domestic sales were also down, dropping 15% year-to-year. Domestic sales of Kia fell by 2%.
Rising costs of raw materials, the COVID-19 lockdown in Shanghai, and the Russia-Ukraine war will continue to impact sales this year, Hyundai says. Hyundai’s 2022 sales goal is 4.32 million vehicles, a 10% increase compared to 2021.
Carmakers including Volkswagen and BMW have joined Hyundai in predicting an increase in chip availability in 2024. Industries related to car manufacturing are also suffering. Tire manufacturer Continental recently announced that its third-quarter margins fell during what they called the chip shortage peak.
