Tuesday, August 30, 2022 9:51 am9 Comments

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C. C. Wei, the CEO of Taiwan Semiconductor Manufacturing Company (TSMC), warned Tuesday that an endemic shortage of chips costing anywhere from 50 cents to $10 is slowing down swathes of the $600 billion semiconductor industry.

Debby Wu for Bloomberg News:

ASML Holding NV of the Netherlands is struggling to obtain $10 chips for its extreme ultraviolet lithography systems, or EUVs, he said. TSMC has dozens of the machines, which are critical for packing more power onto smaller slivers of silicon. Elsewhere, a 50-cent radio chip has been holding up the production of $50,000 cars, Wei said, without elaborating.

Shortages are showing up as a result of automakers adding more features to cars and increasing the silicon used by 15% every year, while smartphones now require two to three times the number of power management chips they did five years ago, Wei said.

“The age of an efficient, globalized supply system has passed,” he said, noting that production costs are also increasing due to more countries racing to build fabs at home. “Costs are swiftly rising, including inflation.”

MacDailyNews Take: The repercussions from stupidly shutting down entire economies over COVID in a rights-trampling panic, instead of thoughtfully working to protect those with comorbidities who were most at risk, will be felt by all of us for many years.

The real virus is the panic. – MacDailyNews, March 9, 2020

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