Electronics Supply Chain Weekly Digest 5-23-25.
DATAPOINT OF THE WEEK: S&P reported May Eurozone mfg PMI increased to 49.4, up from 49.0 in April, and slightly ahead expectations of 49.3.
This reading indicated the slowest contraction in the manufacturing sector since August 2022, supported by a slight rise in output and a stabilization of new orders, bringing an end to a three-year run of continuous declines.
Germany’s mfg PMI also increased to 48.8 from 48.4 in April driven by a strong increase in new export orders, particularly from the US and Europe. However, backlogs of work continued to decrease in Germany, with manufacturing nearly stabilizing.
US mfg PMI surged to 52.3 in May as factory production rebounded to expansion after two months of decline, with new order growth hitting a 15-month high. Inventories rose to their highest recorded level, likely reflecting firms’ efforts to safeguard against tariff-related risks. Longer delivery times, often associated with busier supply chains, also lifted the PMI, with delays reaching a 31-month peak.
Headlines:
Auto/Transportation
- BYD outsells Tesla in Europe EV sales for the first time amid rising Chinese demand and Tesla challenges
- BYD launches low-cost Dolphin Surf in Europe, boosting affordable EV competition and rapid expansion
- CATL invests $2B in German battery plant to localize production amid trade barriers, faces operational challenges
- China’s EV truck market could reach 50% of heavy truck sales by 2028 amid battery industry expansion, according to CATL Chairman
- Global NEV sales rise 39% Y/Y in 1Q25 with BYD leading, but trade tensions cloud outlook, according to TrendForce
- Honda cuts EV investments, shifts focus to hybrids amid slowing EV demand and revises 2030 targets
- Leapmotor narrows Q1 losses with strong exports, targets 2025 breakeven and global production
- Mexico’s cars exported to the US face 15% tariffs on average due to USMCA discounts, not 25%, easing some trade tensions
- Nissan weighs closing multiple global plants, cutting production and workforce to reduce costs
- Stellantis to invest $388M in new Mopar components hub in Michigan, creating 488 jobs by 2027
- US Senate blocks California’s 2035 gas vehicle phase-out, signaling challenges for stricter EV policies
- US EV sales dip 5.9% M/M in April 2025 despite market share gains; inventory and prices rise, according to Cox Automotive
- Xiaomi to launch YU7 electric SUV in July, targeting Tesla Model Y with longer range and higher price
- XPeng beats 2Q revenue forecasts with strong demand and record deliveries, targets mass production of L3 vehicles by year end
Datacenter
- Stargate UAE AI datacenter to launch 1GW phase in 2026 with 100k Nvidia chips, aiming to be world’s largest DC outside US
IP&E
- Broadcom unveils third-gen co-packaged optics doubling speeds to 200 Gbps per lane, cutting power and costs significantly
- Global telecoms drive $40B DCI market growth in 2025, according to TrendFroce
Semiconductors
- Analog Devices posts strong Q3 revenue forecast of $2.75B, but auto segment faces potential sequential decline after tariff pull-ins
- Infineon to supply power modules and MCUs for Rivian’s R2 EV platform from 2026, expanding SiC production with Kulim fab upgrade
- Intel considers divesting network and edge unit to focus on core PC and data center chips, exploring options amid market challenges
- Ireland unveils strategy to attract TSMC and Samsung, targeting 3 fabs by 2040, with Intel expanding 3nm production locally
- Only 3 of 7 new Japanese fabs began mass production by April 2025, as weak demand delays others’ output, according to DigiTimes
- Nvidia CEO criticizes US chip export controls at Computex 2025, cites $15B losses and China market share drop
- Nvidia unveils NVLink Fusion, opening high-speed interconnect tech to partners for ASIC integration, boosting AI workloads
- Panasonic’s second US battery plant for Tesla may start production by July 2025, delayed from March amid tariff and supply risks
- Qualcomm plans data center CPU comeback with custom chips integrated via Nvidia’s interconnect tech, targeting AI workloads
- AMD sells ZT Systems’ server manufacturing to Sanmina for $3B
- Wolfspeed faces bankruptcy amid $6.5B debt, weak demand, and Chinese pricing pressure
Consumer/Other
- China warns of legal action against those supporting US restrictions on advanced Chinese semiconductors, labeling measures discriminatory
- Former President Donald Trump announced plans to recommend a 50% tariff on European Union goods starting June 1
