What are the causes of the shortage?

2021-04-17   By Arttronix

Recently, due to the continued strong global semiconductor demand, especially the tighter capacity of 8-inch wafers and 12-inch wafers, the current shortage has exceeded the increase in capacity of the manufactures. Many electronic components, including active, passive and IP&E products are in the short supply since last year.


This imbalance between supply and demand will lead to structural changes in the semiconductor market. The structural problem that demand growth is greater than the increase in production capacity is difficult to solve in the short term. Semiconductor manufacturers said that the short supply may continue until 2023.


WAHT ARE THE CAUSES OF THE SHORTAGE? one is the accelerated transfer of 4G to 5G, and the silicon content of 5G mobile phones has increased by 35% compared with 4G; second is that the epidemic has detonated the “home office”, which has led to a significant demand increase on laptops and tablets. The third is that new energy vehicles have become a development trend, and the number of chips used in each vehicle has increased significantly. Meanwhile the impact of recent fires and earthquakes is also one of the reason of the shortage on the automotive parts.


Because of this, many semiconductor companies issued the price adjustment statements in which indicates that the lead time has been delayed, some extended to 14-28 months, and there is no delivery date for some products even if the order has placed for months. The entire industry is seriously effected by the short supply.


In order to reduce the loss caused by the shortage, Arttronix has made a lot of efforts in order to stabilize the supply and price of customers. 1) Actively communicating with the original manufacturers and distributors, and work together with the customers to ensure the company's priority supply of some products; 2) Improving supply chain management, and suggest the customer to formulate material procurement plans one year in advance; 3) Signing the Vendor Managed Inventory contract with customers, and help customer to make a timely shipping plan.


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