2020–2023 global chip shortage
Economic shortage caused by demand for semiconductor chips exceeding supply / From Wikipedia, the free encyclopedia
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Between 2020 and 2023, there was a worldwide chip shortage affecting more than 169 industries,[1] which led to major price increases, long queues, and reselling among consumers and manufacturers for automobiles, graphics cards, video game consoles, computers, household appliances, and other consumer electronics that require integrated circuits (commonly called "chips").[2][3][4]
From early 2020, the effects of and the mitigation of the COVID-19 pandemic caused disruptions in supply chains and logistics which, coupled with a 13% increase in global demand for PCs owing to some countries' shift to a stay-at-home economy,[5] impacted the availability of key chips necessary for the manufacturing of a broad swathe of electronics.[6] The pandemic's impact on the manufacture of semiconductors in South Korea and Taiwan was cited as a cause for the shortage, with constrained supply impacting industries as broad as console gaming and the automotive industry.[7][8]
In February 2021, market analysts IHS Markit were cited by the BBC as forecasting the impact of the dearth to last through to the third quarter of 2021; lead times on chip supply at this time had already extended to 15 weeks, the longest lead time since 2017.[8] By April 2021, lead times for semiconductors from Broadcom Inc. had "extended to 22.2 weeks, up from 12.2 weeks in February 2020".[8]
Severe weather events including the droughts in Taiwan during the summer of 2021 could also be a significant contributing factor. The droughts threatened to affect the production due to the lack of available ultrapure water that is needed to clean the factories and wafers.[9][10]
At the end of Quarter 1 of 2021, used car prices in some countries were increasing due to the demand from both economic recovery, as well as the chip shortage. The price of some cars increased as much as 10% in Q1.[11] By 2023, the automotive industry largely recovered with global car production up 3%.[12][13] In the same year, the global chip shortage had mostly subsided.[14]