Recently, TechInsights, a world-renowned mobile phone dismantling agency, asked the internal team about their views on chip shortages and supply chain problems in the past year, and how these problems have affected their work this year.
Linley Gwennap: Principal Analyst
People keep asking me why we have a chip shortage. Despite capacity issues early in the pandemic and production stoppages related to natural disasters earlier this year, shipments of chips have not declined. In fact, global semiconductor sales reached $144 billion in the most recent quarter, a record high of 31 percent from pre-pandemic levels.
The problem is that chip demand is climbing faster. Shipments of laptops skyrocketed in 2020 and rose further this year, with users upgrading for better Zoom Conferencing and Work from Home (WFH) performance. WFH trends have also increased to the right
The demand for cloud services has led to the purchase of more servers by megasizers. Many of these services now rely on neural networks, so Al-accelerator sales skyrocketed in 2020 and 2021. Over time, gamers are looking for new GPU cards; despite the chronic shortage, shipments have increased by more than 50% compared to 2019. While shipments are flat, this year's cars will require far more chips than previous ones, especially for safety systems and electric powertrains.
Therefore, this shortage is a simple case of short supply, despite conspiracy theories. While there has been some price gouging at the retail level (such as cars and graphics cards), chip prices have only risen slightly. These prices are usually stipulated by contract and therefore cannot be changed quickly. The revenue growth mentioned above is mainly due to chip vendors spending their limited supply on high-end products rather than low-cost products.
Fabless manufacturers are constrained by higher prices at their foundries. Wafer prices for mature nodes, such as 45nm, have increased, hampering increased capacity from suppliers of microcontrollers and other low-cost chips. This impact is much smaller at advanced nodes. But wafer prices usually fall in the first few years after the process is upgraded, so this is actually an increase. Chip vendors that tend to stay at N-1 nodes to save costs may have to wait longer to move to the next node.
Once the supply meets the demand, the foundry prices will return to normal. While fabs around the world have made incremental changes to increase production, it will take about two years for a brand new fab to come online. Many companies are investing billions of dollars in new capacity, which will come online in 2022 to alleviate the shortage. While chipmakers typically build leading fabs, some of these investments are moving into older nodes, and recent fab price increases have made such construction profitable.
The semiconductor industry has gone through many cycles of booms and busts, each of which typically lasts two to three years, as it takes time to build new factories. While these cycles have eased over the past decade, the surge in demand driven by the pandemic sparked a sudden boom that led to widespread shortages. Since then, chipmakers have worked overtime to improve supply.
The new plant in 2022 should be able to solve most of the shortages. The next problem will be to avoid a depression, but the number of fabs under construction seems to match the needs of the market. If there isn't any sudden drop in demand, the chip market should return to the Gold zone by 2023, where the supply is just right.
Chris Pawlowicz, Director of Research and Development
From a lab/equipment perspective, we definitely see the impact of supply chain issues.
For the standard repair and maintenance of more than 100 pieces of equipment in our laboratory, we have seen that parts that used to arrive in a few days now sometimes take weeks or even months. We are strengthening our "in-house" spare parts library and often ordering from several sources at the same time because delivery times are so unreliable.
Looking at the new equipment, we see that (in some cases) large items have much longer lead times ... Originally a new ion beam etching machine had a lead time of 8-10 months, whereas now it is 12-14 months.
So, behind the scenes, we now have to really plan ahead and rely less and less on just-in-time delivery.
Daniel Yang is an expert in technical research and procurement
The global pandemic that began early last year has led some semiconductor companies to lower their forecasts for semiconductor consumption. Fears of a global economic downturn have led some semiconductor companies to lower their forecasts for semiconductor consumption. With consumption forecasts lower, these semiconductor companies are likely to produce fewer chips than previously planned. However, the industry did not see any noticeable demand weakness. Some areas, such as remote work and gaming, are experiencing higher demand than ever before, and the shortage of chips has gradually emerged. With the media fueling the waves, everyone is talking about the shortage. Consumers are eager to buy under the threat of more shortages in the future, which further affects the current shortages. More orders went to fabs, and there was a production strain throughout the supply chain.
On how supply chain issues affect his role at TechInsights, he said: "As an example, we are now sourcing DDR5 modules that use the industry's latest computer DDR5 standard. Some memory manufacturers have released their DDR5 products to the market, but the inventory is always out of stock immediately. We had to look everywhere for inventory. We found that some eBay sellers sell modules at a starting price that is several times higher than the normal price. Even at such high prices, there are still some buyers bidding. Another example is last year's nVidia GeForce RTX 3080/3090 GPU card shortage, which is a well-known case in our industry. The shortage lasted for several months. ”
Shawn Payer, expert in technical research and procurement
"I noticed that from 2020 to 2021, the market changed dramatically in terms of being able to successfully order parts or even find products. I sometimes wonder if this is a marketing plan or a shortage of questions. For example, if you look at the PlayStation 5 and XBox Series X, they've been 'sold out' for a year and only a limited number is available. In the few shipments, the sales price is almost twice the order price.
Every graphics card that entered the market in 2021 was immediately sold out; conversely, some of the products that were supposed to hit the market (tablets and laptops) were also sold out. Laptops were supposed to hit the market in early 2021, but they were missing cores. Here's an example of the MediaTek T700 modem, which was advertised in September 2020 as being included in the new HP and Dell laptops in early 2021. The 2021 Dell Latitude 9510 was supposed to be equipped with mediatek T700, but the last to be listed was Qualcomm's Snapdragon X20 modem.
Meanwhile, MediaTek is now working with a company called Fibocom to develop the FM350-GL modem, which is said to use the same technology as mediatek's T700. Did the chip shortage cause a long delay in delivery?
There are other manufacturers that have announced new products and offered orders with very long lead times, such as Xilinx Versal
Al Development Kit. We pre-ordered in February 2021 and it has been postponed 3-4 times and the release date now is January 2022.
I'm not sure if this is a marketing ploy or really the result of a global semiconductor shortage, but when you look at the bigger picture, I think there may be many factors involved in why the technology isn't getting into the market around the promised 2021.
Auto parts have also been searched hard: infotainment devices, ADAS controllers are usually available in April/May, but not until late autumn. Some are still hard to find, and I never noticed how big the impact of the chip shortage in 2020 will be. It's been a tough year.
Judy Morris Procurement Specialist
2021 is the most difficult time to procure parts. As Shawn mentioned, whenever a new graphics card comes to the market, it is immediately sold out. It was then sold on eBay for a significantly increased price. It's now near the end of 2021, and auto parts for vehicles in 2021 are still hard to find. Our best bet has always been to get parts from scrap vehicles.
Even the delivery dates for monitors and computers are very slow. The launch date of the camera and speakers was postponed. The rollout of many new devices has been delayed for several months. Even lab supplies, gloves, etc., this year's delivery time is very long.
Kim Waterman is a corporate marketing manager
When a new disruptive technology is released to the market, news about it usually appears on my desk. We often refer to this as the "Disruptive Technology Brief" and outline where the disruptiveness of a new technology lies – it could be a new technology, a new application of a different chemical, a more comprehensive solution, or a new major player in a mature market.
In 2021, I saw the fewest disruptive tech briefs of any year since I started working at Techlnsights. Some years are the main years of innovation, while 2021 seems to be more of a gradual improvement. The launch of the flagship phone we had been looking forward to has been repeatedly delayed. And many of the major new developments rumored in 2020 are still just rumors at the end of 2021. (Proofreading | Value）
![Do you dare to ask for a car without core? Either wait for half a year or pick up the car and other cores, the owner of the car company suffered[fig]](data:image/gif;base64,R0lGODlhAQABAIAAAP///wAAACwAAAAAAQABAAACAkQBADs=)