For two years the world has been experiencing a worrying reality for the industry sector, with a continuous crisis that has caused the delay of various technological projects and the launch of products caused by production cuts.
In the technological world, integrated circuits known as semiconductor chips are used to create components of various products such as: video game consoles, cars, graphics cards, computers, among others. Currently it is a fact that there is a great demand which has generated an increase in prices and a large waiting list for consumers.
The causes of scarcity: international conflicts and a pandemic virus.
The processor crisis is attributed to three factors that arose in 2020 and continued in 2021: the Covid-19 pandemic, the trade war between China and the United States and the effects of extreme weather.
The arrival of the SARS CoV-2 virus slowed down production in the world when activities in certain sectors were interrupted, generating something unprecedented in modern
Due to the confinements carried out throughout the planet, measures were implemented in various sectors, at the business level remote work was applied and in the educational field distance learning. While these mechanisms fulfilled their function in terms of prevention, it is also true that it increased the demand for technological tools such as: computers, peripherals, smart devices, among others.
According to the specialized media IDC, for the fourth quarter of 2020 due to the Home Office and online classes, computer sales had a growth of up to 26.1% compared to pre-pandemic numbers.
Under the pandemic context and with everyone worried about not contracting Covid-19, the United States and China engaged in an economic conflict, during the administration of Donald Trump the United States imposed restrictions through the Department of Commerce to the company Semiconductor Manufacturing International Corporation (SMIC), which is the largest manufacturer in its field of China, which led to difficulties in selling to U.S. companies.
With the ban, American firms had to turn to buy from other companies, as in the case of Taiwan Semiconductor Manufacturing Company Limited (TSMC) and Samsung companies that were already at the maximum of their production capacity, which also contributed to much of the shortage as they were overwhelmed by demand.
In 2021, there were several incidents derived from inclement weather, such as the winter storm that caused the closure of two chip production plants in Texas belonging to Samsung and NXP Semiconductors. Taiwan had an extremely strong drought which caused problems for Asian manufacturers to clean their factories which was not considered a minor fact as it is the leading Asian country in the microchip industry.
To the above was added the fire of some plants of great importance such as ADC and DAC in 2020 in addition to Renesas Electronics that supplies 30% of the world market and that took about 100 days to stabilize its production, all the above gives us a great perspective of the problem.
What are the industries affected by the chip shortage?
According to a study by the specialized firm Goldman Sachs, at least 169 industries have been affected. In the automotive field, a car has between 1400 and 3000 chips, so losses of 210 billion dollars are estimated.
Another sector that was also affected was that of computer graphics cards which increased their value by 300% when used for cryptocurrency mining generating a great shortage of these.
Virtually all products with electronic components were affected by the crisis.
Ending the crisis
Until the close of this article, there is no consensus about when the shortage of microchips will end, several specialized firms have provided several tentative dates without having any certain so far.
According to an analysis carried out by IHS Markit, the shortage of micro components would end in mid-2022 because favorable conditions have increasingly been noticed in the solution of the problem as mechanisms have been implemented for people to return to their daily activities such as increased vaccination efforts and the decrease in trade restrictions from the United States to China, which would benefit from increased production and stabilization of the market.
The Wall Street Journal assures that the crisis is far from over and even takes up several positions of companies such as PowerX, Apple, Tesla or TSMC, General Motors and Ford, to ensure that things are getting worse, and that this situation will extend for several years.
Pat Gelsinger CEO of Intel said that during 2022 the different sectors will have to deal with the shortage, a fact that will continue until 2023 according to forecasts.