The housing economy has strong market demand, and the supply of large-size driver ICs is in short supply until the end of the year

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According to the latest report of the research institute TrendForce, benefiting from the housing economy effect derived from the epidemic, the demand for IT products will continue to increase in 2021, so the demand for driver ICs will also increase accordingly. Among them, the demand for large-size driver ICs has increased by as much as 7.4% annually. However, 8-inch wafers on the upstream supply side are affected by the production capacity of other high-margin chips, and the supply only increases by 2.5% annually. It is not ruled that the tight supply will continue until the end of the year.

TrendForce said that the demand for large-size driver ICs has increased by as much as 7.4% annually. However, the upstream supply of 8-inch wafers has been affected by the capacity of other high-margin chips, and the supply has only increased by 2.5% annually. Although there are still new foundry production capacity opened this year, including NexChip and SMIC, both have capacity support, and gradually bring small improvements in the supply of large-size driver ICs, but they still cannot alleviate them. The issue of tight supply does not rule out the situation will continue until the end of the year.

In addition to the tight supply of large-size driver ICs, TrendForce pointed out that the recent shortage of TCON (Timing Controller) has also had a significant impact on the shipment of large-size panels, among which high-end models are the most. The main reason is that high-end TCON is mainly produced in 12-inch wafer fabs. In addition to the serious capacity crowding situation, the back-end logic packaging and testing capacity is tight, and there is another worry about the supply of TCON.

Especially for the production capacity of wire bonding and packaging, the process time required for high-end TCON is longer than that of general TCON, so it is more likely to cause the supply gap to gradually expand. With the expansion of logic chip packaging and testing capacity unable to cope with the surge in demand for various application products, the gap in high-end TCON may not be effectively alleviated in the short term.

TrendForce observes that under the current situation where the 8-inch wafer capacity is in short supply, the capacity of large-size driver ICs is still being crowded out by other product applications. It is expected that foundry prices will also be adjusted again in the third quarter, so IC Manufacturers' quotations for large-size driver ICs from panel makers will also have corresponding changes.