News Briefing

Recently, Tesla and other top-tier automakers have concurrently witnessed an increased demand for automotive panels after the shortage of chips has eased, which explains why orders have been pouring in for Innolux and AUO. The two key players of panels have also gained an advantage from both sides as triggered by the blessing of the higher margin of automotive orders as well as the strengthened drive of shipment for Samsung's TV panel sales.

Impact Analysis
According to statistics from LMC Automotive, global auto sales in the second quarter of 2022 were approximately 18.7 million units, a 10.3% decline compared to the same period last year, marking the fourth consecutive quarter of decline. However, the weakness of the global auto market is mainly because the shortage of automotive chips has not eased since the second half of 2021, which has restrained global auto production capacity, rather than the decline in sales caused by consumers' lower willingness to buy. However, with rising inflation and economic worries, the market demand for consumer products has declined, and it is expected to release foundry production capacity and transfer it to the digestion of automotive orders, which will help improve the supply of automotive chips in the second half of the year, thereby stimulating Global auto production momentum recovery.

In recent years, with the global consensus on net zero carbon emissions and the support of incentive policies from the United States, China, and Europe, the penetration rate of electric vehicles has continued to increase, along with the number of automotive electronic products, which will help the development and upgrading of circuit board technology and see an increase in volume and price. At present, automotive boards are still dominated by multi-layer boards, but with the popularization of vehicle electrification, ADAS automatic assisted driving systems, and the demand for 5G Internet of Vehicles, the use of automotive chips and substrates in the future will be more than that of traditional fuel vehicles. The functional requirements also encourage the automotive board to gradually develop towards miniaturization and high function, which will expand the application ratio of HDI and even develop the mSAP process, which is also different from the design concept of the previous automotive board. In addition, the smart cockpit and battery management system (BMS) of electric vehicles are the new development focus of future automotive FPCs, especially BMS. To accurately measure battery voltage and avoid a dead battery, over-charging, and overheating, battery module products will be larger and more precise, and will also make the length of the automotive flexible board longer and longer. Although the production difficulty will increase, it will further increase the use of the automotive flexible board. Therefore, the world's leading manufacturer of automotive flexible boards, Meiko of the NOK Group, will build a new automotive board plant in Suzhou, mainland China, to expand the production capacity of battery soft boards.