Chip Cao Yang must do it.

But the chip is definitely not something that is easy to get.

Even among the tens of thousands of parts in the entire car, the technical threshold for chips is the highest.

Regardless of the chips used in cars, they are generally much behind those used in mobile phones and computers.

However, the development of automotive-grade chips is no less difficult than the chips on mobile phones and computers.

This requires a lot of time, energy and money to invest.

The most troublesome thing is that after spending a lot of hard work and manpower and material resources on research, we finally got some results...

Then the research results are likely to be inferior to mature chips imported from overseas.

Naturally, few car companies are willing to do this kind of loss-making business.

This has further aggravated the generally low enthusiasm of the domestic chip industry.

From raw materials to being delivered to customers, a chip must go through wafer production, which is also considered raw material production.

Then there are the steps of chip design, chip manufacturing, packaging and testing.

There are actually a wide variety of parts used in cars that are related to chips.

Generally speaking, they can be divided into microprocessors, analog devices, sensors, ASIC/ASSP, discrete devices and storage devices by type.

Microprocessors are actually automotive CPUs, which are basically monopolized by Freescale, Texas Instruments, Infineon, STMicroelectronics, Renesas, and Fujitsu. The market concentration of these giants is as high as over 70%.

In the ASIC/ASP field, Freescale, Texas Instruments, Infineon, STMicroelectronics, NXP, Bosch, Panasonic and other manufacturers account for more than 50% of the global market share.

Analog devices and discrete devices are monopolized by ON Semiconductor, Infineon, STMicroelectronics, NXP, Toshiba, and Renesas. The market concentration of these giants is as high as over 70%.

Image sensors, acceleration sensors, and gyroscopes are monopolized by STMicroelectronics, Sony, ADI, Bosch, Freescale, VTI and other companies.

Among them, the image sensor market concentration is as high as 90%, the acceleration sensor market concentration is as high as 70%, and the gyroscope market concentration is as high as 60%.

Of course, most cars do not deal directly with these manufacturers, but trade with parts giants such as Continental, Bosch, Denso, Delphi, Hitachi, ZF, Brose, Valeo, and Aisin.

These components are purchased by these parts giants, and they even purchase them through traders.

As a result, various car companies have even less control over chip-related parts.

This is also when chip supply problems begin to appear in 2020, and the impact will be so large and long-lasting.

To put it bluntly, the OEMs don’t even know where the chips on their various parts come from.

This is also an important reason why suppliers like Bosch and Continental have become unique players in the automotive industry.

Now that Nanshan wants to produce ECU and other control parts, this is definitely going to upset giants like Bo.

No wonder people's reactions were so intense.

As a dedicated automotive microcontroller, ECU is composed of a microprocessor, memory, input/output interface, analog-to-digital converter, and large-scale integrated circuits such as shaping and driving.

There are many chip-related parts that need to be used above.

Although it is only Infineon that has started to restrict the purchase of chips from Nanshan Group, Cao Yang has also been fully aware of the crisis.

Who knows if today Infineon listened to Bosch's persuasion to deal with Nanshan, but tomorrow NXP, Renesas and other chip companies will also jump in to deal with Nanshan?

Even in more than ten years, when Nanshan becomes the world's largest parts company, will the situation become more serious?

Taking this into consideration, Cao Yang's emphasis on the Semiconductor Division of Nanshan Research Institute has increased even more.

"Ayang, although there are several domestic chip companies such as SMIC that can produce some chips, up to now no domestic manufacturer can produce automotive-grade chips."

"For example, for chips in consumer electronics, everyone mainly focuses on the performance of the chip, and does not have high requirements for the working environment and reliability."

"Automotive electronics does not have high requirements for chip performance, but has extremely high requirements for reliability, stability and lifespan."

"When we use mobile phones or computers on a daily basis, we have more or less encountered crashes, blue screens, etc. The treatment methods are nothing more than restarting, repairing, and replacing new ones, which will not involve life safety issues."

"But if something similar happens to a car, it is likely to result in a car crash and death. The severity is not at the same level at all."

"Therefore, the industry generally sets the defective rate of automotive chips at one per million, which invisibly raises the threshold for automotive-grade chips to a whole new level."

"I'll give you a few specific examples to let you feel what the requirements for the working environment and lifespan of automotive-grade chips are."

"Car-grade chips must ensure a 20-year working life under conditions such as -40c to 175c, 95% humidity, 50g of severe vibration, and 15 to 25kv of static electricity."

Xiang Changle is an expert in the research of automotive electronics and control parts.

Although he is not very professional in the field of chips, he is definitely much better than Cao Yang.

So if Nanshan wants to develop chips, Cao Yang must go to Xiang Changle to discuss it.

"Your major has nothing to do with semiconductors, so you may not have much idea about humidity and static electricity."

"Then I will explain the temperature in the most understandable way, and you will know by comparing it."

Xiang Changle saw that Cao Yang listened carefully and took notes from time to time, so naturally he was very motivated to explain.

"The operating temperature of commercial-grade CPUs is generally 0c to 70c."

"The operating temperature of industrial-grade CPUs is generally -40c to 85c."

"Certain types of industrial chips such as oil drilling can reach 175c or even higher."

"As for military-grade CPUs, their operating temperatures are generally -55c to 125c."

"Of course, the operating temperature of military-grade CPUs in some specific scenarios is as high as 200C."

"The operating temperature of automotive semiconductors is -40C to 175C, which has exceeded that of general industrial chips and has reached quasi-military grade."

"After all, the car needs to ensure that it can be used normally in the cold northern zone, and it also needs to ensure that the parts will not fail when the temperature in the engine compartment is very high."

"These requirements for automotive-grade chips have made the threshold very high."

"Some powerful manufacturers, such as Intel, feel that the production of automotive-grade chips is too troublesome, uses backward technology, and the price is not very high, so they are unwilling to spend too much effort to produce them."

"Although some chip manufacturers want to get a share of the pie, they are not strong enough."

"This has led to car-grade chips, which are very monopolistic."

"It seems that there may be seven or eight manufacturers that can produce automotive-grade chips, but when it comes to a certain segmentation type, it is likely that there are only two or three, or even only one, in the world."

"Nanshan Group wants to develop car-grade chips. Let's not say whether it can be done. The various early investments are very exaggerated."

"Even if it is really done, we will immediately face competition from the original chip manufacturers. They can make it bigger at lower cost and with better quality. No one will use your chip at all."

"Even if you, Nanshan Group, use it yourself, some customers may not necessarily agree to your use."

Obviously, Xiang Changle is not optimistic about Cao Yang's efforts to develop chips, and he is still developing automotive-grade chips.

This is definitely more difficult than climbing Mount Everest.

Despite its size, Nanshan Group has made some money in recent years.

But when it comes to chips, it’s not enough.

"Teacher, what you said makes sense. Car-grade chips not only have very high requirements on reliability and other aspects, but also have very strict requirements on the price of the chips."

"Semiconductor companies must meet the extremely stringent certification requirements of OEMs, Bosch and others, and they must be cheap in price."

"This should also be the biggest problem faced by domestic chip manufacturers who have never thought about developing car-grade chips."

Cao Yang did not directly refute Xiang Changle.

Not to mention that he was really doing it for his own good, that's why he was so verbose with me.

Even what he said is factual in itself.

Why China's car-grade chips are still in a mess in 2020 is mainly because of what Xiang Changle said.

The reasons behind it are really complicated and difficult to change.

Domestic self-owned brand automobile companies complain that consumers "favor foreign things" and always like to buy cars from box-brand companies at a premium.

On the other hand, they also like to provide control parts to international manufacturers such as Bosch, Continental, and ZF.

After decades of development, some domestic manufacturers that can produce control parts have finally emerged in China. On the one hand, they complain that independent brand car companies "advocate foreigners" and are unwilling to hand over key control parts such as ECUs.

Produce them.

On the other hand, they themselves always stare at the chips of Freescale, Texas Instruments, Infineon, STMicroelectronics, and Renesas, and disdain the domestic chips that have finally been developed.

Don’t think that domestic chip manufacturers are wronged. In fact, no one is wronged.

This is because on the one hand, domestic chip manufacturers are angry that domestic chip designers favor TSMC's technology; on the other hand, they always purchase equipment from major European and American manufacturers such as ASML, and are unwilling to try to purchase equipment from local manufacturers.

This can be said to be an infinite loop.

It's hard to tell who is right and who is wrong.

It can only be said that chips are an industry with high technical content. Nowadays, European and American manufacturers have formed a monopoly advantage. If you want to break this situation, you need to make a lot of efforts.

Cao Yang is one of the few people in China who are willing to challenge this situation.

"Yes, either the reliability cannot meet the requirements, or the chip is very expensive and not competitive in the market at all."

"It's a hopeless outcome anyway. Who are you going to let do it?"

"So, Ayang, you want to get a chip, the teacher is very happy."
To be continued...