Chip shortages could last until the second half of 2022, White House says

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The global semiconductor shortage will stretch through at least the second half of 2022, the White House has concluded following an investigation of the supply chain.

Chip issues could persist until the second half of 2022
Chip issues could persist until the second half of 2022


Commerce Secretary Gina Raimondo on Tuesday discussed the results of a report her agency conducted. The report, which questioned more than 150 global supply chain companies, showed a "significant, persistent mismatch in supply and demand for chips."

"We aren't even close to being out of the woods as it relates to the supply problems with semiconductors," said Raimondo in a briefing with reporters.

According to Bloomberg, the report concluded that the semiconductor supply chain remains "fragile," with demand far outstripping supply despite months of work by the U.S. to alleviate the issues.

Median inventory of semiconductors has fallen from 40 days to fewer than five days, which leaves "no room for error," Raimondo added. Median demand for chips was as much as 17% higher in 2021 than 2019, with no similar increases in supply.

The shortages are plugging a number of industries across the globe, including the broadband, medical device, and auto spheres. Shortages have also contributed to higher inflation and production delays of electronic devices.

In addition, the Commerce Department report also highlights the limited number of options the U.S. has to mitigate the constraints.

The U.S. also plans to probe allegations of price gouging for auto and medical device chips, but it didn't specify which specific chips or manufacturers are suspected of price gouging.

Raimondo said the report underscored the need for investments in domestic manufacturing. Legislation that's currently making its way through Congress would dedicate as much as $52 billion to encourage chip makers to build plants in the U.S. Those plans won't likely arrive in time to alleviate the current supply problems, however.

The Commerce Department's report was part of a broader Biden administration strategy to address chip supply issues, which the White House has called a "national security issue."

Silicon companies like Apple supplier Foxconn have made similar predictions that the shortages could last until later in 2022.

Chip and semiconductor shortages are a particular pain point for electronics manufacturers like Apple. The company said that supply issues cost it $6 billion during the September 2022 quarter, with a similar hit predicted for the busy December quarter.

Read on AppleInsider

Comments

  • Reply 1 of 10
    wood1208wood1208 Posts: 2,741member
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    edited January 25 williamlondoncat52
  • Reply 2 of 10
    wood1208 said:
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    When did the US replace capitalism with a planned economy? Asking for a friend
    edited January 25 williamlondoncincyteekillroy
  • Reply 3 of 10
    Finally I realized the chip shortage is a consequence of the failed Wuhan semiconductor project. The people in the know don't have the gut to speak the truth for fearing repercussion. Sad!
    sconosciutowilliamlondon
  • Reply 4 of 10
    tmaytmay Posts: 5,722member
    Finally I realized the chip shortage is a consequence of the failed Wuhan semiconductor project. The people in the know don't have the gut to speak the truth for fearing repercussion. Sad!
    https://www.npr.org/2021/03/25/980305760/a-cautionary-tale-for-chinas-ambitious-chipmakers

    You mean outright fraud and technical incompetence, and the inability to license/buy/steal Western tech?
    waveparticleDogpersonkillroy
  • Reply 5 of 10
    fastasleepfastasleep Posts: 6,102member
    wood1208 said:
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    What makes you think ANY administration CAN fix chip shortages? As stated in the article, "Commerce Department report also highlights the limited number of options the U.S. has to mitigate the constraints". Why don't you call the President and tell him what you'd do? Lol
    tmaywilliamlondonDogpersonkillroy
  • Reply 6 of 10
    Really confused article. The headline states that the shortage could last “until” the second half of 2022 (i.e. will resolve at or near the start of the second half). The body states that it could last “through at least” the second half of 2022 (i.e., into at least early 2023). Which is it?
    williamlondon
  • Reply 7 of 10
    wood1208 said:
    This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products. Salary has not gone up to keep up with inflation and now going to be rising Interest rate from Fed.
    Of course the administration can't fix this shortage; the U.S. government doesn't manufacture chips. U.S. industry has been transferring its manufacturing operations to locales with cheaper labor for decades. Now some of the chickens have come home to roost. One can hope that the disruptions spur companies to rebuild domestic manufacturing capacity. Intel's recent announcement in Ohio is a good step, but it hardly repairs the years and years of decline.

    williamlondonDogpersonkillroy
  • Reply 8 of 10
    wood1208 said:
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    When did the US replace capitalism with a planned economy? Asking for a friend

    It's an interesting balancing act, isn't it? Soviet-style centralized planning is obviously a disaster, but the planning done by the Invisible Hand of the Marketplace is shortsighted and focused exclusively on cost. Maybe a little planning – offering some sort of support for industries deemed to be valuable to national economic security – wouldn't be such a bad thing, Charlie Brown.
    williamlondonDogperson
  • Reply 9 of 10
    cincytee said:
    wood1208 said:
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    When did the US replace capitalism with a planned economy? Asking for a friend

    It's an interesting balancing act, isn't it? Soviet-style centralized planning is obviously a disaster, but the planning done by the Invisible Hand of the Marketplace is shortsighted and focused exclusively on cost. Maybe a little planning – offering some sort of support for industries deemed to be valuable to national economic security – wouldn't be such a bad thing, Charlie Brown.
    *whoosh*

    Maybe my response to the OC had nothing at all to do with what I may think about a US administration having an industrial policy for certain critical sectors, Lucy.
    edited January 26 williamlondon
  • Reply 10 of 10
    wood1208 said:
    Sure! This administration has no idea how to fix chip shortages. First they said, last half of 2021 than first quarter of 2022 and now 2nd half of 2022. Than 2023. Keep moving goal post. They don't know what they doing. Industry will figure out and make money by charging more to keep shortage, End result, inflation and regular people pay more for products.Salary has not gone up to keep up with inflation and now going to be rising Interest rate from FED.
    Gratuitous hyper-partisan response.
    sconosciutokillroy
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