Production is increasing but still not keeping pace with demand

According to one study, “the situation is not improving” and supply chain tensions are expected to continue in the coming year.

We know thatin great demand For semiconductors, associated with both digital transformation and new habits followed during the pandemic, as well as delays in production due to the Covid virus, have led to a global shortage of these components.

Although major foundries have announced huge investments to increase their capacities, particularly with the opening of factories, the results of these initiatives will take time. Initiatives hampered by the conflict in Ukraine and the paralysis of Chinese ports. Translation: the shortage will continue.

According to a study by Supplyframe, “geopolitical uncertainty and broad repercussions of the armed conflict in Ukraine, as well as global inflation and recurring Covid-19 outbreaks are exacerbating the situation and straining industry supply chains.”

Challenges

To clarify: “Between the fourth quarter of 2021 and the first quarter of 2022, most components experienced a modest increase in their design and production numbers. Correspondingly, demand for the vast majority of components continued to increase, with microprocessors and microcontrollers registering the largest increase (+ 11%), followed by relays (+10%).

Conclusion, “The situation is not improving.” “The challenges facing the supply chain will continue until 2023. The supply chain in the electronics market can expect increased difficulties next year. Until the first quarter of 2023, more than 70% lead times are expected,” the statement read.

If anyone is still hopeful that we’ll be out of the woods in 2022, it’s a pity we’re not there yet. The current geopolitical conditions, along with inflation and the Covid-19 outbreak, are making the situation even more tense. The supply chain in the electronics sector is set to go through difficult months, with many indicators changing or remaining in the red,” comments Loïc Biarez, Vice President of Product Marketing, France at Supplyframe.

A result shared on BFM Business by Patrick Koehler, CEO of Forvia (formerly Faurecia), an automobile supplier.

“I think the semiconductor crisis will not improve in the second half (2022), perhaps even before the second half of next year: the war in Ukraine, we don’t have a vision, and Omicron in China is complicated,” he worries.

Oliver Schechbortich BFM Business Journalist

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