XNP Executive: The performance of the Chinese market is encouraging, and it is difficult for local IC manufacturers to shake their position
According to foreign media reports, executives such as Bill Betz, the CFO of NXP, recently participated in the Citigroup 2023 global technology conference call and exchanged views on issues of concern to investment institutions such as the Chinese market.
Regarding inventory issues, Bates stated: The way to think about this issue is that the best indicator for us to truly understand the market situation is through sales through our distribution channels. Therefore, in the first and second quarters, we have very strict control. Therefore, if you consider that any new orders received during this quarter are real demand orders, we have seen that we can provide services for them and do better than we imagine Our leading indicator gives you confidence. Since then, I will say that our business in China has been gradually improving every quarter. Although not from a year-on-year perspective, China has improved since the first quarter
In response to the competition raised by Citigroup analysts for domestic simulation IC companies such as SiliJet in China, Henri Ardevol, Vice President and General Manager of NXP Automotive Processing, responded, I think in the low-end market, they may have some opportunities to venture into high-volume, low complexity products. In fact, the transformation of xEV and SDV is accelerating, especially in China. Our perspective and market requirements are to continue to accelerate in terms of complexity and quality of investment portfolios. Therefore, we are not too concerned about the threat from local suppliers in China in the future.
However, Aldewall also stated that "if we were a silicon carbide supplier, the situation would be different", demonstrating its recognition of China's domestic power semiconductor industry. He also mentioned that, I think in China, as a company, about 30% of our revenue comes from China, which is a good thing because China's innovation cycle is much shorter. They are early adopters of new versions of technology, and we are at the forefront of SDV, xEV, and radar innovation. Therefore, we benefit from what Chinese manufacturers are currently doing, providing services in both local and export markets
During the communication, Jeff Palmer, Vice President of Investor Relations at NXP, revealed that currently, 60% of NXP's products are outsourced and 40% are manufactured internally. The company will not build its own 12 inch factory, and over time, the proportion of outsourced production will increase to 70% or even higher.
In response to the competition raised by Citigroup analysts for domestic simulation IC companies such as SiliJet in China, Henri Ardevol, Vice President and General Manager of NXP Automotive Processing, responded, I think in the low-end market, they may have some opportunities to venture into high-volume, low complexity products. In fact, the transformation of xEV and SDV is accelerating, especially in China. Our perspective and market requirements are to continue to accelerate in terms of complexity and quality of investment portfolios. Therefore, we are not too concerned about the threat from local suppliers in China in the future.
However, Aldewall also stated that "if we were a silicon carbide supplier, the situation would be different", demonstrating its recognition of China's domestic power semiconductor industry. He also mentioned that, I think in China, as a company, about 30% of our revenue comes from China, which is a good thing because China's innovation cycle is much shorter. They are early adopters of new versions of technology, and we are at the forefront of SDV, xEV, and radar innovation. Therefore, we benefit from what Chinese manufacturers are currently doing, providing services in both local and export markets
During the communication, Jeff Palmer, Vice President of Investor Relations at NXP, revealed that currently, 60% of NXP's products are outsourced and 40% are manufactured internally. The company will not build its own 12 inch factory, and over time, the proportion of outsourced production will increase to 70% or even higher.