We’re sorry to say that more technology shortages are occurring. The IT industry has been hit with shortages in recent months, which have wreaked havoc on supply chains across the world. Last year, the COVID-19 pandemic led to a sudden increase in demand for laptops, PCs, TVs, and other devices, and semiconductor manufacturers struggled to keep up. This wasn’t the only cause of the shortage. A range of disasters such as fires and power outages at chip production facilities across the globe have only reduced supply further. Unfortunately, shortages are expected to continue for some time. Over the past few months, display driver chips have become embroiled in the crisis as they have been in increasingly short supply, leading to shortages and price increases for screens.
The display driver chip shortage continues
Hundreds of different kinds of chips make up the global silicon industry. One of the chips that is currently in short supply is display driver chips, a component that communicates basic instructions for illuminating screens. They are inexpensive when compared to CPUs or GPUs, as they typically cost approximately $1. Unfortunately, there currently aren’t enough of these chips in existence to keep up with growing demand. As a result, prices are rising for all in the supply chain.
Manufacturers are working hard to try and resolve the worsening crisis. The Taiwan Semiconductor Manufacturing Co. (TMSC), one of the leading advanced semiconductor suppliers, is planning to spend $100 billion over the next three years to increase its capacity. TMSC’s CEO wrote that the company’s manufacturing facilities have been “running at over 100% utilization” over the past year to try and keep up with increasing demand. This has led to a 30% increase in production compared to pre-pandemic levels. Industry rivals in the United States and South Korea are also scaling up their manufacturing capabilities to expand the semiconductor sector. Sadly, manufacturers haven’t yet been able to keep up with demand. Companies such as Himax, Samsung and other key players in the display driver market rely on TMSC for components, and there simply aren’t enough to go around.
When will the crisis end?
It is difficult to know when these unwelcome shortages will end. Despite manufacturers spending billions of dollars to ramp up production as much as possible, the current level of demand is simply too high, and supply can’t keep up. Some industry commentators have explained that electronics will only get cheaper when demand starts to drop, and no one knows when that will happen.
To learn more about the recent semiconductor shortages, visit our blog.