it looks like the industry is caught in the perfect storm

If the equipment is expensive, then a ten percent increase in its cost will remain unnoticed by buyers. But if the chips are installed in budget devices, then the price increase becomes much more noticeable.

TSMC itself has no particular problems – on the contrary, it will receive several hundred million US dollars in the event of a price increase. Analysts believe that additional revenue will be about $ 600 million in the first quarter of 2022. Actually, this is the problem – the companies that participate in the beginning of the electronics production cycle are doing well, from mining companies to TSMC, Samsung and others. This is bad for electronics vendors and especially for buyers.

There are many victims, but there will be even more

The point is that many industries either experience serious difficulties in obtaining the components necessary for the production of products, or stop altogether.

For example, the forecast for the supply of smartphones has already worsened. Analysts from the agency Counterpoint Research have seriously underestimated their earlier forecasts. True, both of them predict a positive dynamics of supply growth, but the problem has not yet fully manifested itself. So, instead of 1.45 billion devices, analysts predict deliveries of 1.41 billion, and possibly even less. Industry

received less

about 80% of the necessary components, despite the fact that the demand for them is growing, but the volume of supplies is not.

Microchip shortage promises hit seriously on the market of switches for data centers. Analysts at another agency, Dell’Oro Group, predict that the problem of component shortages will lead to a deterioration in the supply of switches for the data center. And now it is very difficult to say when the supplies will improve. The average lead time for data center switches was 8-16 weeks, double the lead time. And this is not a crisis yet, forecasts indicate further deterioration.

TV manufacturers have problems as well. According to analyst firm NPD, the price of large-screen NPD TVs has increased by 30%. The reason: just a shortage of chips and some other semiconductor components, which leads to the need to purchase these products at an inflated price, if, of course, there is something to buy. And now not only are there not enough processors with video chips, but even electronic components that are used to create touchscreens. According to a number of experts, after a while any devices with screens, not even touchscreens, will rise in price.

Industries that do not seem to be particularly concerned with electronic components are also suffering. Rather, they were not like that before, but now they are. Speech, for example, about the automotive industry. Thus, Mercedes-Benz will delay deliveries of new cars for more than a year, although not for all models, but for the most “digital” and demanded ones. Opel has decided to close its plant in Germany altogether until 2022. The reason is the same – the lack of chips.

True, there are also lucky ones. For example, thanks to competent logistics, Tesla, on the contrary, was able to produce, deliver and sell a record number of electric vehicles. Increase


immediately 72% compared to the same period in 2020.

When will it be all right again?

Here, you can probably trust the opinion of AMD CEO Lisa Su. She personally attended the Code Conference,

where did she tell

that the current crisis is not like the previous ones. The problem is at the same time in the high demand for components and electronic devices, as well as in the limited capabilities of vendors and manufacturers.

In order to meet demand, companies have to build new factories. This is what AMD, Samsung, TSMC and many others are doing now. But the commissioning of new capacities takes from 18 to 24 months. In some cases, we can talk about longer periods. Accordingly, some relief will come only next year. And then, provided that no other negative factors appear. In this case, there is no need to improve the situation quickly.

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