Chip demand may weaken quarter by quarter in 2022: Report

Market sources said that after nearly two years, as the epidemic in many countries continues to fade, the global semiconductor deficit is supposed to ease, and demand will decline quarter by quarter in 2022, especially in the second half of the year.

According to the “Electronic Times” quoting sources, although semiconductors will remain a seller’s market from the fourth quarter of 2021 to the first half of 2022, chipmakers are not expected to see all of their product lines from the second half of next year. The shipment volume maintained rapid growth.

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With the lifting of barriers in various countries, the demand for home-related applications gradually loses momentum. Starting in the second half of 2021, the demand for chips for notebook computers, mobile phones, and TVs has begun to slow. 

In contrast, the demand for network and automotive chip solutions is still strong, especially for MCUs and power management ICs, while the demand for chips for 5G and AI applications continues to grow.

Moreover, it is expected that for most of 2022, first-tier suppliers of non-consumer chips will maintain strong shipments, but weak consumer electronic equipment demand will bear the brunt of second-and third-tier suppliers.

In terms of foundries, TSMC reiterated that its foundry capacity will continue to be tight until the end of 2022, whether it is mature or advanced process nodes. UMC is also optimistic that strong customer demand will continue into next year.

According to sources, the vacancies in these foundries for consumer chip orders are often quickly filled by network and automotive chip orders. 

In addition, it is expected that by the second half of 2022, the new production lines of production enterprises will begin to be put into operation, and will enter the mass production stage by 2023, when the supply and demand of production enterprises will return to balance.