David Fuller and Eoin Treacy's Comment of the Day
Category - General

    A Year of Poor Planning Led to Carmakers' Massive Chip Shortage

    This article by Debby Wu, Gabrielle Coppola and Keith Naughton for Bloomberg may be of interest to subscribers. Here is a section:

    Carmakers don’t deal directly with TSMC and other contract chipmakers. Instead, they work with auto-part suppliers like Robert Bosch GmbH and Continental AG, which in turn deal with automotive-chip designers including NXP Semiconductors NV and Infineon Technologies AG.

    While those two European chipmakers both make some parts in-house, they outsource a significant portion of production to TSMC and other foundries. It’s difficult for automotive-chip designers to get their orders prioritized by foundries because their volume is dwarfed by their consumer-electronics peers.

    Because of carmakers’ “just-in-time” manufacturing model, their suppliers worried about quick inventory buildups and canceled orders originally planned for foundries in the first half of 2020, the people said. At the same time, foundries began seeing a surge in demand for gadget chips after Apple Inc., Samsung Electronics Co. and Chinese brands prepped an avalanche of 5G devices including the iPhone 12, which require as much as 40% more silicon content as 4G handsets.

    One contract chipmaker notified all its customers in the third quarter that it might be time for them to place more orders as it anticipated a rebound in demand, but automotive clients demurred and ended up being the last ones to seek more capacity, one of the people said.

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    Email of the day - on the early stages of a secular bull market.

    Until the beginning of last year you often spoke on the theme of the early stages of a secular bull market. David had begun speaking about it as long as 4 years ago. But with the onset of the pandemic, you have been largely silent about it. Has it stalled or, in your view, already peaked?

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    Tata Motors ties up with private lenders for commercial vehicles financing

    This article from Bloomberg may be of interest to subscribers. Here is a section:

     

    Homegrown auto major Tata Motors on Monday said it has entered into partnerships with leading private banks, including HDFC Bank, ICICI Bank and Yes Bank, to fund its commercial
    vehicles.

    The tie-ups aim to enhance value offerings for customers of both new as well as pre-owned vehicles throughout the customer lifecycle, Tata Motors said in a statement. The offerings arising out of these tie-ups will include ancillary financial provisions such as fuel financing, working capital financing, aggregate financing and service cost financing. It will enable customers to avail attractive
    financial schemes from all the partner financiers with minimal formalities, it added.
     

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    Email of the day - on how to use the Chart Library

    I hope that you, Sarah and your families are all doing well. I've recently returned to the Fullermoney 'flock' after a hiatus of a few years and am a bit rusty on the chart library. I'm also aware that I never utilized anything close to its full potential, but I do remember you providing some quite detailed instruction - perhaps in a .pdf document, or in particular Comments of The Day? If there are any primers / or a user guide that you could point me towards that would be fantastic. Just in case you're not tired of hearing it, the service is fantastic - thank you!!

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