12/19/2021
The following is excerpted from an article in the Voler Systems newsletter. The chip shortage is affecting me in that I can’t get Raspberry Pi boards for the Embedded Linux Learning Kit
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Anyone in the tech industry knows that we're in a global supply crunch. It's an issue that continues to dominate news headlines. While many believe that the shortage is simply another byproduct of the worldwide pandemic, its impact has far-reaching effects that could shape the market moving forward.
The demand for IoT technology is at an all-time high, and the pandemic only accelerated the need for high-tech solutions in healthcare, manufacturing, logistics, and other crucial industries. Unfortunately, the shortages are putting a damper on progress, leaving many tech companies to reevaluate their plans and find alternative solutions to overcome these unique challenges.
Contrary to popular belief, the timeline of our current shortage doesn't fall in line with the COVID-19 pandemic. The public health crisis certainly exacerbated the challenges we face today, but many experts say that its problems with chip manufacturing started much earlier.
A dramatic increase in demand from the automotive industry is a significant contributing factor. Over the last decade, manufacturers have included more and more intelligent electronics systems into vehicles. Infotainment systems, navigation, steering support, rearview cameras, and other automotive components utilize high-tech chips. The production of Advanced Driver Assistance Systems, in particular, has seen a steady increase since 2014.
The fallout from the global chip shortage is massive. It doesn't just affect one industry or cog in the supply chain. The crisis impacts everything from the design process to consumer pricing.
Companies developing products are experiencing significant delays. Chip delivery times surpassed 20 weeks in 2021. Even Fortune Top 10 companies like Apple had to delay product launches because no semiconductors were available to meet the demand.
Despite the many steps manufacturers and governments are taking to curb the parts supply crisis, it's not a quick fix. We're starting to see improvements in many areas, but the ripple effect will continue to impact the tech industry over the next several years.
Analysts believe that the shortage will last until 2023. Some think that the disruption the crisis caused will take even longer to recover.