01 The growth history of the MCU
MCU, microcontroller, it has a well-known name: single-chip microcomputer.
It is really sweet place is to move a set of basic computer system to a chip, including the internal version of CPU RAM ROM IO counter serial port, although the performance is certainly not as broad as a computer, but it is low power programmable and flexible, so in the consumer electronics, medical industry communication Cars have a very wide range of applications.
It was born in 1971, Intel designed the world’s first microprocessor – the number 4004 4-bit chip, this chip integrates more than 2,000 transistors, and Intel also designed 4001, 4002, 4003 chips, RAM, ROM and registers.
When these four products went on the market, Intel wrote in the advertisement “Announce a new era of integrated circuits: microcomputers condensed on a single chip.” At that time, minicomputers and mainframes were mainly 8-bit and 16-bit processors, so Intel soon launched the 8-bit microprocessor 8008 in 1972 to quickly win the market, opening the era of single-chip microcomputers.
In 1976, Intel launched the world’s first programmable microcomputer controller 8748, which integrates 8-bit CPU, 8-bit parallel I/O, 8-bit counter, RAM, ROM, etc., which can meet the needs of general industrial control and instrumentation, represented by 8748, opening the exploration of single-chip microcomputers in the industrial field.
In the 1980s, 8-bit single-chip microcomputers began to become more mature, RAM and ROM capacity increased, generally with serial interfaces, multi-level interrupt processing systems, multiple 16-bit counters, etc. In 1983, Intel launched the MCS-96 series of 16-bit high-performance microcontrollers, with 120,000 integrated transistors.
Since the 1990s, the single-chip microcomputer has entered the stage of a hundred schools of thought, in performance, speed, reliability, integration in full bloom, according to the number of bits of the bus or data registers, from the initial 4 bits gradually developed, with 8-bit, 16-bit, 32-bit and 64-bit single-chip microcomputers.
At present, the instruction set of MCUs is mainly divided into CISC and RISC, and the core architecture is mainly ARM Cortex, Intel 8051 and RISC-V.
According to the 2020 China General Microcontroller (MCU) Market Brief, 32-bit MCU products account for up to 55% of the market, followed by 8-bit products, accounting for 43%, 4-bit products accounting for 2%, 16-bit products accounting for 1%, it can be seen that the mainstream products in the market are 32-bit and 8-bit MCUs, and the market space of 16-bit MCU products has been severely squeezed.
CISC instruction set products accounted for 24% of the market, RISC instruction set products accounted for 76% of the market mainstream products; Intel 8051 core products accounted for 22% of the market, followed by ARM Cortex-M0 products, accounting for 20%, ARM Cortex-M3 products accounted for 14%, ARM Cortex-M4 products accounted for 12%, ARM Cortex-M0+ products accounted for 5%, ARM Cortex-M23 products accounted for 1%, RISC-V core products accounted for 1%, and others accounted for 24%. ARM Cortex-M0+ products accounted for 5%, ARM Cortex-M23 products accounted for 1%, RISC-V core products accounted for 1%, and others accounted for 24%. On the whole, ARM Cortex series cores account for 52% of the market mainstream.
The MCU market has been facing significant price declines over the past 20 years, but its average selling price (ASP) decline has been slowing over the past five years. After experiencing the downturn in the automotive industry, the global economic weakness, and the epidemic crisis, the MCU market began to recover in 2020. According to IC Insights, MCU shipments increased by 8% in 2020, and total MCU shipments in 2021 increased to 12%, a record high of 30.9 billion, while ASPs also rose 10%, the highest increase in 25 years.
IC Insights expects MCU shipments to reach 35.8 billion units over the next five years, with total sales of $27.2 billion. Of these, 32-bit MCU sales are expected to reach $20 billion with a compound annual growth rate of 9.4%, 16-bit MCUs are expected to reach $4.7 billion, and 4-bit MCUs are not expected to show growth.
02 Car MCU crazy overtaking
Automotive electronics is the largest application scenario of MCUs. IC Insights expects worldwide MCU sales to grow 10% to a record $21.5 billion in 2022, with automotive MCUs growing more than most other end markets.
More than 40% of MCU sales come from automotive electronics, and automotive MCU sales are expected to grow at a CAGR of 7.7% over the next five years, outpacing general-purpose MCUs (7.3%).
At present, automotive MCUs are mainly 8-bit, 16-bit and 32-bit, and different bits of MCUs play different jobs.
The 8-bit MCU is mainly used for relatively basic control functions, such as the control of seats, air conditioners, fans, windows, and door control modules.
The 16-bit MCU is mainly used for lower body, such as engine, electronic brake, suspension system and other power and transmission systems.
The 32-bit MCU fits the automotive intelligence and is mainly used for high-end intelligent and safe application scenarios such as cockpit entertainment, ADAS, and body control.
At this stage, 8-bit MCUs are growing in performance and memory capacity, and with their own cost effectiveness, they can replace some 16-bit MCUs in applications and are also backward compatible with 4-bit MCUs. The 32-bit MCU will play an increasingly important master control role in the entire automotive E/E architecture, which can manage four scattered low-end and mid-range ECU units, and the number of uses will continue to increase.
The above situation makes the 16-bit MCU in a relatively awkward position, not high but low, but in some application scenarios, it is still useful, such as some key applications of powertrain systems.
Automotive intelligence has significantly boosted demand for 32-bit MCUs, with more than three-quarters of automotive MCU sales coming from 32-bit MCUs in 2021, expected to reach about $5.83 billion; 16-bit MCUs will generate about $1.34 billion in revenue; and 8-bit MCUs will generate about $441 million in revenue, according to the McClean report.
At the application level, infotainment is the application scenario with the highest year-over-year increase in automotive MCU sales, with 59% growth in 2021 compared to 2020, and 20% revenue growth for the remaining scenarios.
Now all the electronic control of the car to use ECU (electronic control unit), and MCU is the core control chip ECU, each ECU has at least one MCU, so the current stage of the transformation and upgrading of intelligent electrification prompted the demand for MCU single vehicle usage to increase.
According to the data from the Research Department of the Automotive Marketing Expert Committee of the China Marketing Institute, the average number of ECUs carried by ordinary traditional fuel cars is 70; the number of ECUs carried by luxury traditional fuel cars can reach 150 because of higher performance requirements for seats, central control and entertainment, body stability and safety; and the average number of ECUs carried by smart cars can reach 300 because of the new software and hardware requirements for autonomous driving and assisted driving, which corresponds to the amount of MCU used by single cars will also reach more than 300.
The strong demand for MCUs from automakers is particularly evident in 2021, when there is a shortage of cores due to the epidemic. That year, many car companies had to briefly shut down some production lines due to lack of cores, but sales of automotive MCUs soared 23% to $7.6 billion, a record high.
Most of the automotive chips are produced using 8-inch wafers, some manufacturers such as TI to 12-inch line transfer, IDM will also be part of the capacity outsourcing foundry, which is dominated by MCU, about 70% of the capacity by TSMC. However, the automotive business itself accounts for a small proportion of TSMC, and TSMC focuses on the advanced process technology field of consumer electronics, so the automotive MCU market is particularly scarce.
The shortage of automotive chips led by the entire semiconductor industry also ushered in a wave of expansion, the major foundries and IDM plants to actively expand production, but the focus is different.
TSMC Kumamoto plant is expected to be put into operation by the end of 2024, in addition to the 22/28nm process, it will further provide 12 and 16nm processes, and the Nanjing plant will expand production to 28nm, with a monthly production capacity of 40,000 pieces;
SMIC plans to expand production by at least 45,000 8-inch wafers and at least 10,000 12-inch wafers in 2021, and build a 12-inch production line with a monthly capacity of 120,000 wafers in Lingang, focusing on the 28nm and above nodes.
Huahong expects to accelerate the expansion of 12-inch production capacity to 94,500 pieces in 2022;
Renesas announced its stake in TSMC’s Kumamoto plant with the intention of expanding outsourcing, and aims to increase automotive MCU supply by 50% by 2023, with high-end MCU capacity expected to increase by 50% and low-end MCU capacity by about 70% compared to the end of 2021.
STMicroelectronics will invest $1.4 billion in 2022 for expansion, and plans to double the capacity of its European plants by 2025, mainly to increase 12-inch capacity, and for 8-inch capacity, STMicroelectronics will selectively upgrade for products that do not require 12-inch technology.
Texas Instruments will add four new plants, the first plant is expected to be put into operation in 2025, and the third and fourth plants will be built between 2026 and 2030;
ON Semiconductor increased its capital investment to 12%, mainly for 12-inch wafer capacity expansion.
IC insights has an interesting data that the ASP of all 32-bit MCUs is declining at a CAGR of -4.4% year-on-year between 2015 and 2020, but rises about 13% to about $0.72 in 2021. Reflected in the spot market, the price fluctuation of automotive MCU is more obvious: the NXP 32-bit MCU FS32K144HAT0MLH with a standing price of $22 surged up to $550, a range of more than 20 times, which was one of the most scarce automotive chips at that time.
Infineon 32-bit automotive MCU SAK-TC277TP-64F200N DC had risen to 4,500 yuan, an increase of nearly 100 times, the same series of SAK-TC275T-64F200N DC also soared to more than 2,000 yuan.
On the other side, the originally hot consumer electronics began to cool down, the weak demand, as well as the acceleration of domestic substitution, making general-purpose, consumer MCU prices back down, some ST chip models such as F0/F1/F3 series prices came to near the normal price, and even the market rumors that the price of some MCUs have fallen through the agency price.
However, automotive MCUs such as Renesas, NXP, Infineon, and ST are still in a state of relative shortage. For example, the price of ST’s high-performance 32-bit MCU STM32H743VIT6 climbed to 600 yuan at the end of last year, while its price was only 48 yuan two years ago. The increase is more than 10 times; Infineon Automotive MCU SAK-TC237LP-32F200N AC market price in October last year at about $1200, December offer up to $3800, and even on third-party websites offer more than $5000.
03 The market is large, and domestic production is small
The MCU competitive landscape is as dominated by overseas giants as the entire semiconductor competitive environment. In 2021, the top five MCU vendors were NXP, Microchip, Renesas, ST, and Infineon. These five MCU vendors accounted for 82.1% of total global sales, compared to 72.2% in 2016, with the size of the headline companies growing in the intervening years.
Compared with consumer and industrial MCU, automotive MCU certification threshold is high and the certification period is long, the certification system includes ISO26262 standard certification, AEC-Q001~004 and IATF16949 standard certification, AEC-Q100/Q104 standard certification, of which ISO26262 on automotive functional safety is divided into four levels of ASIL-A to D. For example, the chassis and other scenarios have the highest safety requirements and require ASIL-D level certification, few chip manufacturers can meet the conditions.
According to Strategy Analysis data, the global and domestic automotive MCU market is mainly occupied by NXP, Renesas, Infineon, Texas Instruments, Microchip, with a market share of 85%. Although 32-bit MCUs are still monopolized by overseas giants, some domestic companies have taken off.
The rapid development of intelligent electric vehicles, so a number of consumer chip makers have joined, such as Nvidia, Qualcomm, Intel have been in the intelligent cockpit, autonomous driving chip breakthroughs, compressing the survival space of the old automotive chip manufacturers. The development of automotive MCUs has gone from focusing on self-development and performance improvement to all-round competition for cost reduction while maintaining technological advantages.
With the automotive E / E architecture from distributed to domain control, and eventually towards central integration, there will be more and more multi-functional and simple low-end chip will be replaced, high-performance, high computing power and other high-end chips will become the focus of future automotive chip competition, as the main control role of the MCU by the future ECU number reduction is relatively small, such as the Tesla chassis control ECU, a single contains 3-4 MCU, but some simple function of the basic MCU will be integrated. Overall, the market for automotive MCUs and the space for domestic substitution in the coming years is undoubtedly vast.
Post time: Feb-01-2023