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The global chip shortage continues to worsen, with companies reliant on new chips seeing production and delivery delays stretch to more than a year, and in some cases to 2024.
The global semiconductor shortage has caused problems for many companies around the world, with slow chip shipments impacting the ability of suppliers to finish products and complete orders. As the crisis continues, businesses see the delays spread even further.
In the case of utility watchdog PowerX, a chip order placed in May was originally scheduled for delivery by summer, but was then delayed to fall, then winter, and is not expected. now not arrive before May 2022, according to the Wall Street newspaper. PowerX is not alone, as Princeps Electronics’ COO Ian Walker said some new buyer orders have delivery dates in 2024.
Susquehanna Financial Group said chip wait times fell from 9 to 12 weeks to 19 weeks in summer, to 22 weeks in October. In some cases, such as power management components, it takes an average of 25 weeks, while microcontrollers used by the automotive industry can take up to 38 weeks to arrive.
Apple is also affected by supply chain issues, warning in its financial results that issues with “legacy nodes”, namely modems and power regulators, are the main point of competition for the company. The accessibility of “cutting edge nodes”, like Apple Silicon, is not an issue for Apple at this time.
The shortage is caused by multiple issues, ranging from COVID-19 facility closures, reduced supplies of substrates and other base materials, and interruptions in wafer production. Global shipping issues have compounded the problem, as chips can potentially travel up to 25,000 miles to become finished goods.
While the chip supply chain is one aspect, another is with chip buying decisions, oversupply and storage causing their own problems. Willy Shih, professor at Harvard Business School, said: “People buy a lot of parts just to have them just in case, and that makes the shortage worse”
Chip producers like Apple’s partner TSMC have announced plans to invest heavily in facilities to improve production, but the costly efforts could take years to not only become operational, but to do enough to facilitate supplies. .