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CHIP SHORTAGE NEWS Global chip shortage 2022 - updates in June

Updated on 10.02.2023 From Luke James

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How are companies responding to the chip shortage and what are policymakers commenting? Here we continuously sum up the most important events related to the global shortage of microchips!

The global chip shortage emerged in 2020 and is an ongoing problem where the demand for integrated circuits such as computer chips is greater than supply.
The global chip shortage emerged in 2020 and is an ongoing problem where the demand for integrated circuits such as computer chips is greater than supply.
(Source: Quardia Inc. -

The chip shortage continues in 2022. While some experts believe that the situation will improve this year, others are convinced that the crisis will persist into 2023. This article is updated continuously and summarizes the most important chip shortage news in June 2022.

Chip shortage expected to impact contactless card delivery until next year

The delivery of contactless payment cards will continue to be impacted by the global chip shortage and supply chain disruption until 2023, according to a recent forecast by the Smart Payment Association (SPA).
“This ongoing supply challenge results from a range of factors including post-Covid recovery leading to a surge in demand for semiconductors,” the researchers say. “Additionally, payment card deliveries are suffering from extended lead times for key raw material supplies such as plastic, metal and other components of a smart card.”

The SPA points to several factors including recent Covid-related factory shutdowns in China, supply chain disruptions created by materials shortages, and freight capacities that still haven’t returned to pre-pandemic levels. Last year, the SPA announced that annual global shipments of contactless cards exceeded 2 billion for the first time in 2021 but conceded that this figure would have been higher if it had not been for the chip shortage.

Japanese chipmakers anticipate talent shortage

Japan’s biggest chipmakers, Sony and Toshiba, have warned that the Japanese government’s push to revive its domestic chip production is being threatened by a shortage of engineering talent. The potential labor shortage comes as Japan works to boost investment in semiconductors as part of its efforts to improve economic shortage in the wake of the global chip shortage

In an appeal to the ministry of economy, trade and industry last month, a Japanese electronics industry body said the five years until 2030 represented “the last and biggest chance for Japan’s semiconductor industry to regain its footing” after steep drops in its global market share in recent years.
“It is often said that semiconductors are lacking, but the biggest shortage is engineers,” said Hideki Wakabayashi, a professor at the Tokyo University of Science who is the head of the policy proposal task force at the JEITA semiconductor board.

Taiwan-based chipmaker to build plant in Texas

Taiwan-based chipmaker GlobalWafers has announced plans to help ease the chip shortage in the United States by building a USD5 billion factory in Sherman, Texas. In a press release on Monday, June 27, the company said that it will manufacture silicon wafers for Intel and Taiwan Semiconductor Manufacturing Co. (TSMC) as part of a U.S. effort to increase the domestic production of semiconductors.

"Today's announcement from GlobalWafers is critical to rebuilding the domestic semiconductor supply chain, strengthening our economic and national security, and creating U.S. manufacturing jobs," said. U.S. Secretary of Commerce Gina Raimondo.
Current U.S. semiconductor production is expected to meet only 20 % of domestic demand by 2025, with the chip shortage disrupting the production of a wide range of products, including electronic systems and automobiles.
"With the global chips shortage and ongoing geopolitical concerns, GlobalWafers is taking this opportunity to address the United States semiconductor supply chain resiliency issue by building an advanced node, state-of-the-art, 300-millimeter silicon wafer factory," said Doris Hsu, GlobalWafers chairman and CEO.

Stellantis stops production at Melfi plant due to chip shortage

Dutch automotive manufacturing corporation Stellantis, whose subsidiaries include Peugeot, Chrysler, Opel, Dodge, and Maserati, will halt operations at its key Melfi plant in southern Italy from June 28 until July 2 due to a structural shortage of semiconductors.

A spokesperson Stellantis confirmed the news and said it had been taking decisions on its operations on a day-by-day, plant-by-plant basis since the start of the COVID pandemic. "We do not expect to see a stabilization until the end of 2022," the spokesperson said. Stellantis builds the Jeep Compass and Jeep Renegade at its Melfi plant, along with the Fiat 500X.

This most recent stoppage means that the Melfi plant will have only operated for seven days in June. Marco Lomio, the head of the UILM union for the Basilicata Region, where Melfi is located, said he feared July could be even worse. "The company told us they had no visibility on supplies," he told Reuters. Stellantis employs more than 7,000 workers at the plant.

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Singapore manufacturing output up amid chip shortage

Singapore’s overall industrial output in May far exceeded forecasts and grew 13.8 % year on year. This growth has been largely attributed to strong demand from 5G markets and data centers amid a global semiconductor chip shortage, official data showed on Friday, June 24.

Economists had previously expected a 5.8 % year-on-year increase in May, according to a Reuters poll. On a month-on-month and seasonally adjusted basis, industrial production in Singapore was up by 10.9 % in May while 2.8 % growth had been previously forecasted.
Meanwhile, electronics output soared by 33.6 % year-on-year, compared with just 10.4 % in April. In particular, semiconductor output surged 45.7 % year on year, improving from April’s 12.9 % and helping to offset contractions in other segments.

French SOI supplier Soitec announces Singapore fab extension

French silicon-on-insulator (SOI) wafer supplier Soitec has announced that it is building an extension to its 300mm SOI wafer fab in Singapore. In doing so, the company hopes to double its capacity to meet the demand for semiconductors.
“The semiconductor market is set to double in the next seven to eight years. You can imagine the capacity that needs to be put in place. What we have done in 30 years, we have to do in eight years,” CEO Paul Boudre said at a recent press conference.

To keep up with customer needs, the company has already announced a new facility at its headquarters in Bernin, France, primarily to produce more SiC wafers. “In view of the demand, we have had to invest and increase our production capacity of 300-mm SOI wafers,” he added.
The extension at the company’s Singapore facility comes in response to strong demand for SOI wafers and specifically 300-mm SOI wafers, Boudre said. “... we intend to double the capacity of this site and add 1 million wafers per year, which will allow us to go to a total capacity of 2.7 million 300-mm wafers.” Demand for SOI wafers is being driven by demand in areas including automotive, smart devices, and mobile.

Toyota suspends production in Japan until July

Toyota Motor Corporation announced on June 16 that it will be suspending operations at more production lines at its factories in Japan for up to 11 days between this month and July, citing a difficulty in procuring semiconductors and a COVID-19 outbreak at one of its suppliers in Shanghai.

The automaker said that the production halt will take place on 11 lines across seven factories from Friday, June 17 until Friday, July 8. According to Toyota, it will now produce about 750,000 vehicles globally in June, down slightly from its previous production target of 800,000.
While Toyota has not yet disclosed its worldwide production targets for July, the automaker has said that it doesn’t plan to change its global production target of 9.7 million units for the fiscal year.

Semiconductor sales expected to rise despite market pressures

Despite problems including rampant inflation across the globe, rising energy costs, supply chain disruption, renewed COVID-19 lockdowns in China, and the ongoing war between Russia and Ukraine, IC Insights anticipates an 11 % increase in total semiconductor sales for 2022—the same rate that was forecast in January.

According to IC Insights’ McClean Report for Q2 2022, sales growth forecasts have been both raised and lowered in a number of major product categories. While this means that many predictions are markedly different from those given in January, they have offset one another to maintain the overall anticipated growth of the semiconductor market at 11 % for the year.

For instance, the Q2 2022 update revises the sales forecast for microcomponent ICs to 11 % up from 7 % earlier this year while optoelectronics has been revised downwards to 6 % from 13 % in January.
Overall, total IC sales growth in 2022 is unchanged and expected to rise 11 % this year to a record-high USD567.1 billion.

Hyundai says no substantial recovery possible this year

Automaker Hyundai has said that it doesn’t believe that any substantial recovery is possible this year, adding that it’s “very difficult” to predict when the semiconductor shortage will begin to ease. These are the words of Tarun Garg, the director of sales, marketing & service for Hyundai Motor India.
Recently, Hyundai India revealed that, locally, the automaker had no less than 135,000 pending orders for new vehicles. While increasing production is an obvious priority, this is impossible due to the chip shortage which makes it impossible to build cars at the right price for the market.
According to Garg, the company is still sitting on a backorder of around 25,000 units of the old Hyundai Venue model. “We have given a priority to all those customers who had booked the old Venue, and their booking seniority remains. That is why people who book the new Venue will have a relatively longer waiting period,” he said in a recent interview.

Intel taps factory network to oercome substrate shortages

Since the beginning of the global pandemic, surging demand for computing has placed the semiconductor industry at the epicenter of unprecedented supply chain disruptions. This has created a shortage of key chipmaking components, including a foundational piece of nearly every advanced processor in the world: the Ajinomoto build-up film (ABF) substrate.

Intel has recognized the contributions of its Vietnam site to alleviating constraints in the global semiconductor supply chain. Thanks to an innovative approach to processing substrates in its assembly and test factory, Intel delivered millions of additional units of chip production over the past year – meeting customer demand while the industry struggled to weather a shortage of this critical component.

“This is the ultimate demonstration of why integrated manufacturing is a benefit to Intel and our customers,” said Kim Huat Ooi, vice president and general manager of Intel Products Vietnam. “By bringing this capability in-house, we are able to complete chip assembly more than 80 % faster, while at the same time freeing up the substrate suppliers who are constrained on capacity. Over the past year, we demonstrated that this is a scalable manufacturing process with quality that matches that of our substrate suppliers. Going forward, we plan to continue to scale capacity to enable this approach for a broader range of products.”

Global semiconductor sales increase

The Semiconductor Industry Association (SIA) today announced global semiconductor industry sales were USD50.9 billion in the month of April 2022, an increase of 21.1 % over the April 2021 total of USD42.0 billion and 0.7 % more than the March 2022 total of USD50.6 billion. Monthly sales are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average. SIA represents 99 % of the U.S. semiconductor industry by revenue and nearly two-thirds of non-U.S. chip firms.

Sales were up compared to April 2021 in the Americas (40.9 %), Europe (19.2 %), Japan (18.5 %), Asia Pacific/All Other (18.1 %), and China (13.3 %). Month-to-month sales increased in the Americas (3.1 %), Japan (1.6 %), and Asia Pacific/All Other (1.2 %), but fell slightly in China (-0.6 %), and Europe (-3.3 %).

Qualcomm CEO predicts end of chip shortage

Qualcomm CEO Cristiano Amon has said that the global semiconductor shortage is likely to ease by late 2022 into early 2023, but a growing demand for chips across all industries underscores the need for diversification in the U.S. supply chain and more production of domestic chips.

"One thing we determined is chips are important… chips are going to be an essential ingredient when we think of our economic growth, chips are going everywhere," Qualcomm CEO Cristiano Amon told Fox Business on Thursday, June 2nd.

"Where we are right now: We still have more demand than supply, but we’re starting to see in the second half of 2022, a more balanced equation. I think as we enter 2023, we’re going to get out of the crisis," he added.
Amon went on to say that despite this, some companies might not see supply chain issues ease until 2024.

Intel considering cooperation with Samsung

Intel CEO Pat Gelsinger recently met with Samsung executives to discuss a potential collaboration. The news of these talks comes as competition with main rivals Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker, begins to heat up.

According to The Korea Herald, Gelsinger flew out to Korea after attending the 2022 World Economic Forum in Switzerland to meet with Samsung Vice Chairman Lee Jae-yong, co-CEO Kyung Kye-hyun, and other key figures. Reports claim that Gelsinger and Samsung officials discussed how they could cooperate better and "exchanged opinions on next-generation memory chips, fabless system chips [and] foundry chips as well as those for PCs and mobile devices."

Intel has recently kicked its chip manufacturing into a higher gear with major plans for investment. In January, the company announced a US$20 billion investment package to build a new factory in Ohio before spending US$5.4 billion in February to purchase Israeli chipmaker Tower Semiconductor.

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