It’s not just car companies that are reducing costs, are IC people ready?

1. Automakers are under pressure to cut costs, and chips are the first to bear the brunt.

• Domestic mainstream car companies require parts suppliers10% price reduction, the price war is fully upstream.
• It is common practice to reduce costs year by year after the plan matures, but this roundNo difference, substantialLowering prices indicates that competition in the industry has become fierce.
• As the core cost item of intelligence, chips will inevitably become a key target for car companies to reduce costs, source and replace them.

2. Major international manufacturers are forced to localize to survive.

• ST holding handsHua Hong Semiconductor, 40nm automotive grade MCU will beend of 2025Put into production locally.
• Core logic:If you don’t produce in China, you won’t be able to keep up with the speed of China’s new energy vehicles.。
• In the past, overseas manufacturers exported technology, but now they mustClose to the market and reverse learning, in response to the rise of local chips.
• Result: The supply of automotive-grade chips has increased significantly, the logic of overseas high prices has collapsed, and the bargaining power of automotive companies has further increased.

3. ADI streamlines channels and accelerates the de-distribution of original factories

• In UK, EMEADramatically reduce distributors, triggering a strong rebound in the channel.
• Adjustments to the cooperation model with Arrow: Cancel the demand creation function and only retain itOrder fulfillment, logisticsfunction.
• vigorously promoteOfficial eShop Direct Sales, directly reaching end customers.

1. Reduce channel costs and preserve profits
2. Direct access to real demand, inventory and customer data
3. Give priority to big customersdirect supply model, improve efficiency and reduce terminal prices

4. Three major trends reshape the IC industry landscape

1. Supply side: excess capacity + local manufacturing

   The establishment of overseas factories + the parallel expansion of local production, the overall supply of chips is loose,Long-term price decline。
2. Channel side: The rise of direct sales and the shrinkage of distribution

   Domestic original manufacturers also generally tend to supply directly to large automakers, and distributors' profit margins continue to be squeezed.
3. Demand side: Automakers are driving prices down to the extreme, and substitution is accelerating

   Cost reduction pressure directly drivesDomestic replacement, cost performance, delivery and service have become core competitiveness.

5. IC distribution and survival answers for practitioners

• Give up the obsession with scale,Prioritize realizing profits
• Deeply cultivate the subdivided areas and doTechnology-based and solution-based distribution
• Provide domestic alternative selection, stable supply chain, FAE technical support, etc.irreplaceable value
• Embrace the direct supply trend and shift from traders toService providers, solution partners