A wide range of industries is facing a shortage of semiconductors and the problem is likely to persist for at least a ‘couple of years’, said new Chief Executive Officer of Intel Corp. Pat Gelsinger. Looking at the concerns of the auto industry over the chip shortage, Intel is reworking some of it factories to ramp up production. In an interview with a news channel, Gelsinger said that it will take several months before the supply strain even starts to begin easing. “We will take a couple of years to catch up the surge in the demand across every aspect of the business,” the CEO said.
Demand for semiconductors increased suddenly in 2020 as consumers started looking for home gadgets during the coronavirus-induced lockdown. But chipmakers struggled to meet the increase in demand as because of shuttered plants. There are some other factors as well that have contributed to it. Several companies are of the view that the supply constraints will continue for much of 2021. The global shortage of chips has brought the manufacturers in limelight. They are on top of the political agenda as several industries are struggling to meet their demands of the semiconductor shortage. Biden administration has already stated that they are ready to extend all kinds of support to address the shortage.
Gelsinger said that Intel is the only company that manufactures high-end cutting-edge chips. The lockdown had dwindled the dominance of the United States in the industry. So much so that the manufacturing has reduced to 12 per cent from 37 per cent. The semiconductor shortage has hit a wide array of industries. One of the worst affected is auto industry that has already flagged production cuts and lost revenue. All the big auto manufactures have announced the cut. Recently, Ford said that the shortage will reduce production by 1.1 million vehicles. Apple also said that the supply constraints are impacting sales of Macs and iPads.