Chip shortages, Windows tools
April 24, 2021
No, not delicious tortilla chips. I'm talking about semiconductor microchips.
We have a global shortage of chips. These are the chips used in cars, laptops, refrigerators, gaming consoles, microwave ovens, smartphones and even toys.
There's no shortage of wires or circuit boards, but the chips themselves are another story.
So, why is there a shortage? Few manufacturers have enormous warehouses full of the parts they need to make whatever they make. Instead, they rely on just-in-time (JIT) inventories. Manufacturers place orders and schedule deliveries to be just in time for the production line: no high warehousing costs, but a considerable dependency on getting deliveries on time to keep production running.
Then along comes a little thing called COVID-19, and suddenly deliveries aren't getting where they need to be, just in time, or sometimes ever. Ships carrying the needed chips end up stuck in port in Asia instead of making deliveries to manufacturers worldwide.
The COVID-19 induced lockdowns resulted in consumers buying vast numbers of computers, phones, tablets, appliances, gaming consoles and other electronic goods as they whiled away their time inside. Inventories for nearly everything with a spark shrank, and manufacturers started panic buying all the chips they could, driving up their final product costs.
A fire at a Japanese chip-making plant that makes much of the global supply of micro-controller units used in cars hasn't helped. Severe weather in Texas closed down chip factories from Samsung, NXP Semiconductors, and Infineon that also make chips for the auto industry.
The shortages have forced many automakers to shut down production lines for less profitable vehicles. GM, Ford, Volkswagen, Subaru, Toyota and Nissan are all building fewer vehicles overall.
Most global chip production came from Asia. But Asian companies have been slow to invest in new chip fabrication plants for 5G and processor technology, and are having a hard time ramping up production to meet increased demand. Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) and Samsung make chips for thousands of applications for hundreds of companies.
So, the factories are behind, container ships aren't crossing the ocean as regularly as before, demand has skyrocketed, and nobody has warehouses full of chips.
How do we fix the problem?
"Making chips" is a process called semiconductor device fabrication and happens in factories known as "fabs." These fabs cost billions of dollars to build and can take up to two years to get up and running.
Only about 12 percent of the global chip making capacity is in the U.S., the government is seeking billions in funding to supercharge chip manufacturing at home. Intel has announced plans to build two new fabs in Arizona. Up to now, Intel has only built chips for Intel. But the company says the new fabs will make chips for other companies. TSMC also announced a new fab in Arizona, and Samsung is planning one in Texas. Both manufacturers currently make chips for many companies.
It will take a year or two to get production lines, and the chip fabs they rely on, up to speed again.
A couple of useful Windows 10 tools
Snip & Sketch lets you do screen captures and annotate your captures. Press the Windows key + Shift + S to open Snip & Sketch.
Clipboard History now keeps the 25 most recent things you've copied so you can reuse them. Open Clipboard History by pressing the Windows key + V.
What's the difference between putting a microchip in a snail and punching a grasshopper in the face?
One is bugging a slug.
The other is slugging a bug