The global chip shortage is leading to product delays and price increases for a wide range of products including automobiles, game consoles, and single board computers. And it could continue through much of 2021, and possibly into next year or beyond.
There are a number of factors contributing to the shortage – rising demand for electronics for use in devices like cars that didn’t used to need them, increased demand for personal computers and other gadgets during the pandemic thanks to rising numbers of people working from home, and a fairly small number of manufacturers capable of actually cranking out the some of the most advanced chips.
Meanwhile companies that can afford to hoard chips they need for their products are doing so rather than deal with potential shortages down the road… which makes it tougher for smaller companies or startups to get their orders filled.
All told, it’s pushing lead times (the time from when an order is placed to when the product is delivered) back by months. Bloomberg has an overview of how we got here, while CNX Software has shared a translation of lead times for major chip manufacturers that shows just how much longer it takes to get chips these days.
One thing that’s unclear? How or when the chip shortage will end.
While Intel recently announced plans to spend $20 billion to build chip manufacturing plants in the United States and to begin manufacturing chips for other companies, it will be several years before the new facilities come online.
- How a Chip Shortage Snarled Everything from Phones to Cars [Bloomberg]
Wondering why there’s a chip shortage? This is a pretty good explainer. In a nutshell, a handful of manufacturers have the expertise in making the most advanced chips, demand was up during the pandemic, and companies that can afford to are hoarding.
- Semiconductors lead times in March 20 [CNX Software]
And if you’re wondering how much longer it takes to get chip orders filled due to the shortage, here’s a handy chart showing that lead times have increased by anywhere from 2 to 18 weeks depending on the type of chip and the manufacturer.
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