The U.S. Congress and the Biden Administration are hurtling down the track toward investing billions of dollars in the domestic semiconductor manufacturing industry. But there is a flaw in their approach because they are ignoring the broader manufacturing infrastructure that is needed to combine semiconductors with other parts to create reliable electronic systems.
London (CNN Business)In the market for a new car, smartphone or washing machine this year? A global shortage of computer chips could mean you have to wait a while and pay more.A growing number of manufacturers around the world are having trouble securing supplies of semiconductors, delaying the production and delivery of goods and threatening to push up the prices paid by consumers.
Unexpected events in 2021 have worsened the supply of already short raw materials like silicon and glass substrate, wafers, crystal oscillators and plastic. As a result, production for a variety of components has been impacted, causing shortages of ICs, CPUs and memory.As we move through Q2, we will see impacts of these unpredictable disruptions unfold as we deal with additional raw material shortages on the horizon.
The burgeoning semiconductor shortage of 2021 hit chipmakers “like a ton of bricks,” according to one distributor. Of course, that’s not the phrase semiconductor suppliers would use.
As e-waste continues to head toward the world’s landfills and keeps on increasing, the push is on to recycle and reuse more end-of-life electronic products.
As per a report by Reuters, French Finance Minister Bruno Le Maire called for a new plan on electronic components to reduce European dependence on Asian suppliers in the domain this year. He told reporters such dependence was unacceptable and was making the European Union vulnerable in industries like car manufacturing that had run short of some components from Asia.
The electronics industry has developed leaps and bounds over the past century. With the Consumer Electronics segment projected to reach a revenue of $415,897m in 2021 with an annual growth rate of 4.0%, stated by Statista, the industry is not slowing down anytime soon.
Business conditions generally improved in late 2020:Third-quarter 2020 electronic equipment sales returned to near “break-even” compared to Q3 2019 (chart 21).November 2020 world electronic equipment shipments were up 11.4 percent versus November 2019, and up 7.3 percent sequentially compared to October 2020 (chart 2)Preliminary combined regional Q4 sales data show a marked upturn versus the third quarter (chart 3)Monthly world PCB shipments have likely reached their 2020 seasonal peak (chart 4)Sources: Regional and company financial data consolidated and analyzed by Custer Consulting
Markit Economics has released its December “flash” PMIs:December vs. November by country/region (chart 1)Historical Manufacturing PMIs by month:USA (chart 2)Eurozone (chart 3)Germany (chart 4)France (chart 5) Japan (chart 6)
The idea that the electronics industry would close the year on a high note seemed absurd 9 months ago. But like the manufacturing sector writ large, the supply chain has bounced back from the worst of coronavirus pandemic.“In spite of serious concerns about both supply and demand impacts in the early stages of the Covid-19 pandemic, it appears sales levels for 2020 will remain fairly stable compared to 2019 with some sectors showing relatively mild declines and others actually achieving growth,” according to Dale Ford, ECIA’s chief analyst. Just days before the ECIA report was issued, the Institute for Supply Management released similar findings – supply executives were more optimistic in November than they were the prior month.U.S. manufacturing growth has softened but remains above pre-pandemic levels. The ISM’s factory index, the PMI, declined by 1.8 percent — to 57.5 — from October’s level of 59.3. ECIA’s December forecast for overall component sales registered 113.9, down from 136.9 in November. The line between growth and contraction is, respectively, 50 and 100.
As the coronavirus pandemic has triggered shutdowns and restrictions across the state, a staggering number of small businesses in Massachusetts have closed their doors amid plummeting revenues, according to Harvard researchers.
The coronavirus pandemic has put chief supply chain officers (CSCOs) under pressure to adapt and prepare their networks for an uncertain future. In fact, Gartner says supply chain leaders should focus on adapting their strategies, investment and leadership styles to ensure long-term efficient growth.