NXP Semiconductors N.V. and Datang Telecom Technology Co., Ltd. today announced that they have been awarded a business license for their joint venture (JV) by the Chinese Government. This marks the establishment of China's first true automotive semiconductor business. Headquartered in Nantong, China, near Shanghai, Datang NXP Semiconductors Co., Ltd. has begun operations. The company will focus on the research, development and sale of advanced application specific automotive ICs in High Performance Mixed Signal technology. NXP – already the number one automotive semiconductors supplier for China – has a 49% share in the JV with Datang Telecom owning the other 51%.
Paul Zhang has been named the chief executive officer and general manager of Datang NXP Semiconductors Co. Ltd. The fabless firm will be focused on automotive ASICs (application specific integrated circuits) based on mixed signal technology. The staff at Datang NXP Semiconductors Co., Ltd., comprised of local engineers and experts, will have a particular focus on developing semiconductor solutions supporting the growing demand for new automotive energy technologies for electric and hybrid vehicles in China. The Chinese government has placed emphasis on its commitment to developing energy saving and new energy vehicles that will support its growing economy.
Datang NXP Semiconductors expects a ten-year compound annual growth rate (CAGR) of 70% in the number of electric vehicles (EV), from less than 20,000 to over 3 million units in the next 10 years. The Chinese government is extending its program to subsidize the purchase of EVs, from 25 to more than 80 cities, and plans to invest heavily in building more charging infrastructure to support EVs, installing over 200,000 charging stations throughout the country.
"This is a very exciting time for NXP in China. With this JV we are in an ideal position to take advantage of the opportunities this diverse market presents. We are confident that the Chinese governments' investment program will be instrumental in driving the private customers’ appetite for electric vehicles," said Drue Freeman, senior vice president, global automotive sales & marketing, NXP Semiconductors. "Alongside Datang Telecom we are making a long-term investment in China, and pioneering market-leading automotive solutions. Through these solutions we will be able to drive the industry forward in China and go on to make a positive impact on other markets across the world."
"Bringing together the expertise of the market leader in China, NXP, and the local knowledge of Datang Telecom puts us in an ideal position to lead the Chinese automotive semiconductor market," said Paul Zhang chief executive officer and general manager of Datang NXP Semiconductors Co. Ltd. "What's important for us is that we are able to address the needs of the Chinese market as a local Chinese company, whether it's supporting electrification of modern vehicles or enabling power management; we will continue to innovate and offer solutions that will enable Chinese customers to meet the requirements of this incredibly fast growing automotive market. We have already begun this process, shipping products supporting light leveller systems, which NXP contributed to the JV."