CHIPS AWAY: SEMICONDUCTOR SHORTAGE WREAKING HAVOC IN TECH

As Samsung Electronics warns that it’s grappling with the fallout of a “serious imbalance” in semiconductors, the technology world could be about to enter its own ‘lockdown’. From the PlayStation 5 to the new Tesla Model S, virtually every device maker could be forced to temporarily halt production, caught off-guard and causing delays to 2021 product pipelines.

THE GREAT 2021 CHIP SHORTAGE

Though Samsung might be one of the world’s largest makers of chips and consumer electronics, the company was the latest to voice concerns in its latest business quarter update, where co-Chief Executive Officer Koh Dong-jin revealed that the company was even contemplating skipping the release of its Samsung Galaxy Note to streamline its lineup. Some of the biggest players in semiconductors, including Continental AG and Renesas Electronics Corp, have recently warned of longer-than-usual delays due to growing demand for electronics in the midst of the COVID-19 pandemic. As consumers spend more time indoors, more are upgrading their devices, replacing their TVs, and considering new automobiles to spend their cash in lieu of vacations and experiences. It is true that pursestrings have been tightened, but companies such as Apple reported record growth in 2020; in the quarter to June 2020, Apple posted revenues of $59.7 billion, up by more than 11% from the year-ago quarter; its iPhone 12 proved incredibly successful, too.

But as chip supplies run dry, there’s a genuine risk that companies struggle to fulfill demand and we see a backlog of products entering the market, impacting virtually every sector. Even auto manufacturers such as Volkswagen AG are impacted, with the company claiming it’s lost production on over 100,000 cars worldwide as a result of semiconductor shortages.