How Long Will the Chip Shortage Last?

Every industry that relies on semi-conductor chips including storage, RAM, and CPUs has had to deal with the limited supply of these chips in the last two years. This has led to a significant increase in the prices of the products that use these chips. At Lantana, we have always been doing our best to ensure our clients get all the products they need within acceptable delivery times.

 

Despite all interventions, the only long-term solution for this problem is manufacturing chips that meet the current demand. The million-dollar question is how long will take to get to get to that point?

 

How it all started!

Before we even think of when the chip shortage problem will be fixed, let’s look at what caused this problem in the first place. The chip shortage problem started in the first half of 2020 when most chip factories partially or fully shut down for a couple of months. All this was due to the restrictions put in place by various governments to minimize the spread of the covid19.

 

Most of the factories for companies, including Intel, Samsung, and TSMC reduced their production capacity by a significant margin due to the lack of enough manpower. This wasn’t a problem for the first couple of weeks since the demand for almost every product had gone down.

 

However, as people started to adjust to the new way of living, the demand for electronics products, including computers, smartphones, and tablets went up. Remember, all these products use multiple semiconductor chips. As demand for these products went up, different manufacturers also increased the size of their orders for the various chips needed to meet this demand.

 

It is at this point that we all started feeling the manufacturing gap that was created by the partial and total shutdowns of most chip manufacturing factories.

 

When will the chip shortage be resolved?

Most experts expect this chip shortage to continue for the next 6 or even 12 months. Chipmakers, including Samsung, TSMC, and Intel have all been doing their best to ensure all their manufacturing plants operate at maximum capacity to meet the surging demand for chips that has been going on for the last 2 years.

 

What we are doing to help out clients

At Lantana we have managed to help all our clients get the different components and chips without significant delays. We also encourage our clients to plan ahead by ordering the various components they need early enough and not just a couple of weeks before they need to use them. This strategy has helped many clients to have all the chips they need at the right time.

 

We also partner with a number of key suppliers and manufacturers of electronic products. This enables us to have insider information on what the supply of these products could be like in the next couple of months. We use this information to give appropriate recommendations of when our clients should place orders for the various product.

 

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