Chip shortage! And Global pandemic! What’s Next?

5 min readMar 5, 2021

Here’s how the Global chip shortage got so bad and what’s being done to fix it?
What are semiconductors?
The Transistor
What causing it?
What’s being done to reduce chip shortage?
What’s Next?

It’s not an overstatement to say that semiconductors power the modern world. They’re not only a key component of nearly every electronic device we buy and use. They also power the factories that make the electronic devices we buy and use! They power our laptops, cell phones, cars, washing machines, our refrigerators! Yeah, even our refrigerators use and this is just the stuff in our home. We’re not even getting into all the way semiconductors are important to the military and to the power grid. One thing to know is! If the software is eating the world then the chips are the teeth and now there aren’t enough of them!

Global chip shortage is getting so bad that one of the world’s largest automakers said it could lose up to two billion dollars! Because the semiconductor chip shortage forced it to temporarily shut down some auto manufacturing plants. President Joe Biden just established economic and national security specialists to look for gaps in the semiconductor supply chain in the united states. They want to see how reliant the US has become in other countries to manufacture semiconductors.

Read More:

Here’s how the Global chip shortage got so bad and what’s being done to fix it?

What are semiconductors?

People talk about semiconductors now they’re talking about advanced microchips. That power smartphones computers and cars and advanced medical equipment and the analogue semiconductor devices that power radios and thermostats!

The Transistor

A kind of semiconductor was first successfully demonstrated in 1947 at bell labs in new jersey. Its inventors won the Nobel prize for physics and created the first tech companies in silicon valley. Which basically laid the foundation for the modern digital world. After the transistor came to the integrated circuit! The microprocessor etc until the super small super-advanced chips we have today.

Now the semiconductor industry is massive within the industry. There are semiconductor companies that design the chips called fabulous companies and some companies that manufacture them called foundries. There are also integrated device manufacturers like intel that both design and manufacture chips more and more! Though major semiconductor companies are adopting the fabulous model and contracting out orders to foundries! Like Taiwan semiconductor or Samsung and that trend toward fabulous has helped complicate the chip shortage. We’ve all been hearing about the US chip industry has captured 47 percent of the global market share in sales! But only 12 in chip manufacturing according to the semiconductor industry association.

What causing it?

The coronavirus pandemic forced people to work from home. Go to school home to just basically do everything from home! People upgraded their computers they got smart speakers tricked out their home theatres and played a lot of video games. Businesses scrambled to set up remote work systems and needed more cloud infrastructure. There’s no sign that the demand is slowing for semiconductors global semiconductor sales totalled 439 billion dollars in 2020! And that’s an increase of 6.5 compared to the 2019 total of 412.3 billion dollars! According to the semiconductor industry association, global sales for the month of December 2020 were 39.2 billion dollars! An increase of 8.3 compared to December 2019!

Another big reason for the shortage is cars are getting more advanced and they need more semiconductors. In fact, right now it’s the auto industry that’s feeling the squeeze in computer chips. Most acutely cars not only need advanced chips to run increasingly complicated in-vehicle computer systems. They also need older less advanced semiconductors for things like power steering. Analysts expect the chip shortage to persist well into 2021.

What’s being done to reduce chip shortage?

Semiconductors have been essential to nearly every industry. The chip shortage has forced the white house! To take steps to shore up the chip supply chain in the united states. At the semiconductor companies, executives say! They’ll be able to ramp up production to end the shortfall but that likely won’t happen until later in 2021. After the immediate shortages get resolved. The demand for semiconductors is only supposed to increase. The New 5g telecom networks need smartphones with 5g enabled chips. And that so-called internet of things will put chips into more and more everyday devices! And the remote work brought on by covid 19 appears here to stay.

What’s Next?

China is attempting to become self-sufficient when it comes to semiconductor chips right now it imports most of its semiconductors. You should know that Beijing has always had big ambitions to have its own home-grown industry! But the US restrictions not only on sales to china for chips! But also on a telecoms giant, Huawei that has really acted as a stimulus for the industry. So Beijing has made chips a top priority for its next five-year plan. Which is going to be unveiled in march! Independence is one of five quote fundamentals of china’s economic development and 1.4 trillion dollars has been earmarked to develop the semiconductor industry by 2025! To have 70 percent of chips used in china made in china.

A lot of people in the business world start to really look at Chinas supply chains. Because of Covid 19. It’s no secret that electronics manufacturing is based in China. But what people don’t know is that the number one pure chip factory in the world is in Taiwan that’s TSMC. Now Taiwan does not have the trade issues that china has! But it’s still an island off the coast of china.

So there was a lot of discussions early in the pandemic last year! That we have to look at the stuff from a geopolitical standpoint. Because you know if the military can’t make a jet because they don’t have chips because Taiwan is caught in a geopolitical dispute! A lot of people just said we need the ability to make leading node chips here in the united state! So what you think about the global chip shortage! Let us know in the comment section.

Want to read more of this kind of articles visit here for free.