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Semiconductor Industry Outlook 2022 : STMicroelectronics

STMWhat kind of changes has been experienced in your focused areas in 2021? How would you summarize the challenges and opportunities encountered this year?

2021 is an unprecedented period – a very challenging year for many industries and for the semiconductor industry in particular. The shortage of semiconductors that have been experienced globally is related to the fast recovery of the economy following the initial impact of the pandemic. But it is also related to an ongoing transformation of two of the markets we address i.e. automotive and industrial.

The automotive industry is moving to electrification and digitalization. The changes in car architecture enabled by these two shifts have opened the market to new players across the value chain, changing some of the market’s dynamics and key players. Here, Asia and China, in particular, are finding success.

The Industrial market is also undergoing a transformation, to meet the challenges of the “green economy”, of smart industry, of smart cities, of smart buildings. And these transformations are boosted by the government’s incentives accelerating the changes.

The key impact of the pandemic, beyond the short-term economic impact, has been the acceleration of those transformation trends, which reflects into all industries we serve with higher-than-initially anticipated growth rates or system architecture changes.

Finally, we are also seeing changes in the global economy, which is moving from complete globalization to partial regionalization in some areas.

Do you think the chip shortage will continue in 2022? Why? In response to this situation, any countermeasures from the company?

As said, ST, during the coming years, will invest significantly, in order to set up the right manufacturing base to support our customers. This year we will spend approximately 2.1 billion dollars of capex. This includes $1.4 billion for global capacity increases well as ~$700M for what we call strategic programs, to prepare the future. These programs include our new 300mm fab under construction in Agrate (Italy), our silicon carbide initiatives in Catania (Italy) and gallium nitride in Tours (France). We will increase our front-end manufacturing capacity significantly in next 4 years and plan to double the overall capacity in our European fabs between 2020 and 2025. This is mainly through increases in our 300 mm capabilities but also includes selective increases in our 200mm manufacturing capabilities for technologies that do not require 300 mm such as BCD, advanced BiMOS and ViPower.

 We are also continuing our investments in silicon carbide manufacturing capacity in Catania, Italy and Singapore as well as in verticalization of the supply chain. We plan to increase our SiC front-end manufacturing capacity 10x vs the 2017 level by 2024 as we support the ramp-up of the many customer programs we have in both the automotive industry and industrial applications.

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