Interview
The Semiconductor Shortage of 2021
- The supply crunch is primarily attributed to the pandemic, with average order lead times projected to stay above the 13-week concern threshold, currently standing at 14 weeks.
- Shortages are expected to persist for trailing edge technologies, such as microcontrollers and power devices, due to reliance on manufacturing equipment over a decade old.
- Industry capacity expansion involves significant timeframes, with new factory construction requiring approximately two years and equipment installation in existing facilities taking more than six months.
- The shortage for specific components is forecast to continue through year-end, driven by the long lead times necessary to increase production capacity.
- Price volatility is anticipated, with increases expected for microcontrollers and critical components, although isolated price decreases have occurred in certain areas.
- Companies are planning to reassess supply chain vulnerabilities and inventory practices in response to ongoing constraints.
- A risk exists that demand could overshoot actual needs due to double ordering and stockpiling efforts by companies attempting to secure parts against future shortages.