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The world doesn't have enough computer chips. That's bad news for you

April 29, 2021. Summarized by summa-bot.

Compression ratio: 23.3%. 1 min read.

A Texas DAC8718S integrated circuit microchip (IC), manufactured by Texas Instruments Inc., on a printed circuit board (PCB) at CSI Electronic Manufacturing Services Ltd. in Witham, U.K., on Wednesday, April 28, 2021. The global chip shortage is going from bad to worse with automakers on three continents joining tech giants Apple Inc. and Samsung Electronics Co. in flagging production cuts and lost revenue from the crisis. Photographer: Chris Ratcliffe/Bloomberg via Getty Images

In the market for a new car, smartphone or washing machine this year? A global shortage of computer chips could mean you have to wait a while and pay more.

A growing number of manufacturers around the world are having trouble securing supplies of semiconductors, delaying the production and delivery of goods and threatening to push up the prices paid by consumers.

When the pandemic forced carmakers to temporarily shutter factories last year, semiconductor manufacturers reassigned spare production capacity to companies making smartphones, laptops and gaming devices — products in high demand from housebound consumers.

Ford warned Wednesday that the chip shortage will reduce production this year by some 1. 1 million vehicles and cut its profit by about $2. 5 billion.

The chip shortage places the production of 1. 3 million cars and vans at risk globally in the first quarter, according to research firm IHS Markit.

Samsung told analysts on its earnings call Thursday that it's working hard to reduce shortages of semiconductors and other key parts, which could weigh on sales of products like smartphones.

In a call with analysts on Wednesday, Apple (AAPL) chief financial officer Luca Maestri said that the company expects revenue will be $3 billion to $4 billion lower this quarter thanks to "supply constraints. " That includes problems procuring chips, which are expected to affect the production of iPads and Macs.

For consumers, the chip shortages could lead to an increase in the cost of goods.

"Even though demand for consumer electronics and cars tends to be quite price sensitive and is likely to moderate with even modest price increases, we estimate reduced supply could boost prices by 1-3% in affected categories," Goldman Sachs analysts said.

by summa-bot

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