The Chip shortage crisis start from April 2020, and it become more and more serious from 2021 to now.“The chip crisis will last until 2023 impossible to increase production” mentioned by The CEO Jean-Marc Chery of STMicroelectronics, which is Number one of the largest electronics group and the Italian and French state-owned shareholdings,
Deloitte recently released a report that the situation will not be better until 2023. While the intel CEO Pat Gelsinger think that the semiconductor shortage will drift into 2024, from their earlier estimates in 2023, as the shortages hit equipment will be more challenged. (Here is the CNBC report where Gelsinger talks about the Chip shortage).
It is still too early to say precisely when the Chip shortage crisis will end, but it won’t be better in 2022.
Why The Chips Production Capability Can’t be Improved.
It is not simple to expand the chip production capacity, as the huge investment in the chip industry, and one production line will cost 20 to 30 Billion US dollars. Meanwhile, it is a long investment cycle, and it is uncertain whether the high demand will last, so the chip manufacturers are very cautious about expanding production capacity.
However, there are good news that since the global chips shortage problem has not been effectively relieved, The manufacture of semiconductor such as
Intel, TSMC, Samsung, and SMIC have announced to expand chip production capacity and build the production lines for wafers. Meanwhile, global investment institutions continue to focus on the field of chip semiconductors.
2022 Chip Shortage Update
As a full turnkey service of PCB and PCBA, FX PCB also meets the same Challenge with our customers,
and we suggest our customer plan the production well and try to order the components 3-6 months earlier to avoid the multiple times cost from the market later.
For some urgent orders, in which customers can’t find the chips anymore from the market, we will try to help their sourcing from the China components agency, but the cost is always very expensive than the original one.
FX PCB also gives ideas to customers for the replacement, once customers approved the replacement, we can provide them the price.
We are happy to supply you the sample to confirm the quality, and the small-batch quantity is also acceptable.
Why Is There A Chip Shortage
1. Chips Manufacturing Capability
Chip shortages don’t mean low-end chips, there are many countries that can manufacture this kind of chips. The real shortage is the high-end chips, 14nm, 7nm, 5nm and etc, which need very high technology to make them.
The chip manufacturing industry is concentrated in America, South Asia, Korea, and Japan, where the covid epidemic has severely impacted 2021. Meanwhile, Texas surfed the cold wave, and the Ibaraki chip manufacturer in Japan got the file, which all makes the chips become worse.
2. Chips Demand Increasing
When the epidemic started and the production capacity of the manufacturing plants has been reduced. Most people begin to work and study at home, and it leads the requirement for television, computers, cameras, cloud computing, remote technology and etc increased, Which the Chips need to be used lots
3. Equipment for the Chips
It is not difficult to design the chips, but it is harder to manufacture. We need the lithography machines, especially the ASML lithography machine in Netherland, and it required first-class technology from multiple countries. So it is limited to the lithography machine production. However, they are many companies that demand the chips, which eventually leads to a shortage of supply
4. Material of the Chips
Wafers are the main material for manufacturing chips, and the supply of wafers also decreased during the epidemic. the supply and demand relationship of chips has been unbalanced, so the industrial chain has also been affected, and there will naturally be a shortage.