Intel CEO Says Global Chip Shortage Could Take Years to End
The chip shortages could last for several years, Intel’s new CEO has warned.
According to Intel’s new CEO, the global chip shortage may not end in 2022 and could take years to resolve completely, due to enormous pressure on global supply chains.
Intel warns of prolonged chip shortage
Intel’s new CEO Pat Gelsinger was speaking during a virtual session at Computex in Taipei when he briefly touched on the topic of the global chip shortage that has affected many areas of technology, ranging from electric cars to computers, smartphones and tablets. to game consoles, graphics cards and beyond.
But while the industry has taken steps to address the short-term constraints, it will take the ecosystem a few more years to address shortages in foundry capacity, substrates and components.
In other words, expect chip shortages to continue beyond 2022.
Why is there a shortage of chips?
The silicon crackle is the result of the perfect storm of the following factors:
- Covid pandemic: People are improving their work from home facilities.
- Interlocks: We bought some new gadgets to keep us entertained during lockdowns.
- Production issues: Chip plants temporarily broke due to health protocols.
Together, these factors have resulted in unprecedented global demand for semiconductors that could not be met on time, regardless of your perspective.
The CEO of Intel admits this himself, saying he believes this “cycle of explosive growth in [the demand for] semiconductors “has put unbearable pressure on global semiconductor supply chains.
A crisis in the chip manufacturing industry
To make matters worse, chipmakers can’t just spend money on the problem to make it go away – it takes billions of dollars and 18-24 months to build a sophisticated semiconductor factory from scratch. , to the point where she is able to do so. churning of chips by volume.
Intel, for its part, is investing $ 20 billion in two new plants in Arizona and expanding its current chip manufacturing capacity. In addition, Intel will open its factories to outside customers, which has never been done before.
Additionally, the struggling chipmaker plans to expand to other locations in the United States and Europe. The move is expected to ensure “a sustainable and secure semiconductor supply chain for the world,” Gelsinger said recently without giving further details.
Electronics makers Samsung, Sony and Xbox have said the global chip shortage will last through at least 2022, underscoring the global nature of the problem.
Graphics cards are now more expensive than before. Some Macs and iPads are in low supply. Nintendo Switch sales are affected. And good luck with buying a PlayStation 5 in 2021!
Rival Taiwan Semiconductor Manufacturing Company (TSMC), meanwhile, has set aside $ 100 billion to increase production capacity. To give you a better idea of the magnitude of the problem, TSMC was operating at full capacity in 2020 – and it’s the world’s largest semiconductor foundry we’re talking about.
The shortage of chips is the reason you can’t buy a PS5 and why your new GPU could cost twice as much.
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