A global shortage of chips, the tiny devices at the heart of every electronics gadget, is having a ripple effect across the wider consumer electronics industry and analysts say the squeeze could last through 2021 and into 2022 given the multiple factors at play, reported the South China Morning Post.
The crunch, which began with automotive chips that control car brakes, doors and windscreen wipers, is now being felt in the supply of chips used for smartphones, laptops, washing machines and refrigerators. The issue highlights the disruptive effects of both the China-US tech war and the Covid-19 pandemic on a supply chain that is truly global.
While price rises as a result of the chip shortage remain confined to the semiconductor sector for now, analysts say some low-margin consumer products may start to see price rises in the near future if the capacity crunch persists.
Analysts say the origins of the chip shortage can be traced back to tech restrictions placed on China by the Trump administration, with companies now moving away from “just in time” production to hoarding large stockpiles of chips, creating serious shortages.