Because the global hunger for chips is becoming a problem

Because the global hunger for chips is becoming a problem

The shortage of semiconductors is impacting the production levels of many industrial sectors, starting with the automotive

The motherboard of a computer Photo by Magnascan from Pixabay The shortage of semiconductors is limiting the growth of several industrial sectors who use the chips for their technological supports, automotive and IT in particular. Qualcomm, General Motors and Samsung have recently issued warning signals and Germany itself has asked Taiwan to give priority to the production of chips for cars. The small Asian democracy is increasingly at the center of international relations, as the home of the world's two largest producers of technological nodes: Tsmc (28% of the market share) and Umc (13%). China's Smic (11%) and Korea's Samsung (10%) follow.

The pandemic has disrupted supply chains, increasing demand for work-from-home devices, while artificial intelligence technologies and electric mobility have gained visibility. The main reason behind the current shortage of chips are years of under-investment in the capacity of the wafers that comprise them, according to analysts at Counterpoint. In the 2015-19 period, the sector's average capital intensity (the ratio of investments to turnover) was 11-18%, but a new cycle of capitalization should favor an increase to 20-22% in 2021-2023, without immediately resolving the crisis. The shortage of semiconductors will continue until the third quarter of 2021, the increase in prices until 2022, experts say.

Qualcomm itself has explained that supplies will remain limited for the first half of the year and yesterday it lost 7.6% in trading after the regular market close, although in recent days it has hit an all-time high (hitting about $ 167 per share), with sales up 63% yoy in the last quarter. On the other hand, General Motors will suspend or limit production at four plants in the United States, Mexico, Canada and South Korea next week due to lack of chips. The problem also affects other manufacturers and the States have activated diplomatic channels with Taiwan, so much so that Tsmc has responded positively to the call for a reconversion in favor of the automotive industry.

Faced with this scenario, Samsung, the main manufacturer of smartphones in the world, is considering urgently expanding its semiconductor manufacturing capacity, which accounted for nearly half of its profit last year. Higher production costs and a stronger won could affect earnings in the first quarter, but full-year outlook remains positive.

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