In the world of semiconductors, Infineon has been slow to find its place. Built in the bosom of the German conglomerate Siemens, the group gained its independence in 1999 thanks to a split. After escaping bankruptcy in extremis in 2009, Infineon has refocused on its most stable businesses to become a recognized specialist in industrial automation, energy management and, above all, the automotive industry.
The German manufacturer is credited with a 2.3% share of the vast semiconductor market, which ranks it 11th in the world, between AMD and Apple. But unlike these two Americans, he derives nearly half of his income from the automotive sector, in which he is the main player on a global scale. Infineon has been able to leverage its expertise, largely inherited from its proximity to its compatriots Volkswagen, Daimler and BMW.
This industry is now looking for a new model, adapted to the electric vehicle, which will include even more on-board electronics. What to see the future with optimism. While, under the hood of a thermal automobile, there is the equivalent of 450 euros of semi-conductor equipment “only”, this amount should increase to 875 euros for its electrical equivalent. Infineon therefore has a good card to play with a clientele certainly known to negotiate its prices, but who are reluctant to juggle between suppliers.
The rest of the group’s activity is divided between three branches: that of “power supply systems and sensors” (29% of revenues), oriented towards consumer equipment and telecom networks; that of “secure systems” (13% of revenues), which ranges from components for the connected home to identification systems and that of “industrial power controllers” (13% of revenues), which can be found in robots , household appliances or energy management.
During the decade 2013-2022, Infineon’s revenue more than tripled, net earnings per share increased sixfold, while margins nearly doubled. These performances illustrate the successful takeover of a company that is now positioned among the best in its sector. Along with the Franco-Italian STMicroelectronics, it is also one of the rare European players to have succeeded in establishing itself in a sector largely dominated by the United States and Asia. A good pick therefore, to make the synthesis between technology and mobility.
And also… Two other values to follow closely
We no longer present You’re here, of which the Model 3 has become the best-selling electric car in Europe. The newcomer, piloted by the ubiquitous Elon Musk, has imposed its rules of the game on traditional manufacturers. And when Tesla decides to launch a price war to take advantage of its technological lead, the competition has cold sweats and must resolve to line up to stay in the race, even if it means cutting back on its precious margins. The company is one of the best placed to capture the growth of the electric vehicle market, which is expected to reach, on average, 17% per year by 2027.
Unknown to the battalion in the West, the Chinese manufacturer BYD (sign of Build Your Dreams, in French “build your dreams”) has nevertheless sold more hybrid and electric cars than Tesla in 2022. Precisely 1.9 million units, three times more than in 2021. Its presence is still limited outside its field of home game. However, things could change quite quickly. The company plans to expand massively in Europe, where it plans to build factories to avoid EU tariffs on Chinese car imports.
An article from the special issue of L’Express “Investing in the ecological transition: 20 values to follow”, published on July 6.