It was reported that Chuck Robbins, CEO of American network equipment manufacturer Cisco, said a few days ago that the global shortage of computer chips will continue until about the end of 2021.
The crisis continues
Due to the superposition of the new crown epidemic and other factors, the global semiconductor supply shortage has caused many companies to be forced to suspend production and reduce production. Luo Zhuke said in an interview with the media: “We think it will take another six months to overcome the difficulties.”
He said that semiconductor suppliers are expanding production capacity because the situation will get better in the next 12 to 18 months.
It is extremely critical for semiconductor manufacturers to expand production capacity because all current high-tech technologies are driving the demand for chips, including 5G, cloud computing, Internet of Things, and artificial intelligence.
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Recently, many big names in the technology industry have talked about the core shortage crisis, and Cisco’s network equipment supports 85% of the world’s traffic. Therefore, Rodrike’s point of view is very weighty. “Now, the core shortage crisis is a big problem, because the chip Almost everywhere.” He said.
Driven by market demand, Intel, the largest semiconductor company in the United States, previously announced that it would invest US$20 billion to build two new chip factories in Arizona, the United States, to substantially increase production capacity.
Dan Ives, a technology analyst at Wedbush Securities in the United States, said that the current world demand for chips is more than a quarter of the highest level expected by everyone, causing tight supply.
However, although the core shortage crisis will continue for some time, global technology stocks have performed well in the past few months. Investors are mainly targeting the market’s long-term demand for technology products.
Highly concentrated
The “Semiconductor Industry Association” in the United States stated that 75% of the world’s chip manufacturing capacity is in East Asia, with Taiwan’s TSMC and South Korea’s Samsung Electronics as the two major foundries.
At present, both the United States and Europe hope to realize more localized manufacturing of semiconductors. In this regard, Luo Zhuo Ke said: “I don’t think where the chips are made is not a problem, the key is that you have multiple sources of supply.”
However, Kissinger, the head of Intel, said in a recent interview that so many chips are now produced in Asia, which is unacceptable. TSMC is currently the world’s largest semiconductor foundry. The company must firmly control its leading position and plans to invest 100 billion US dollars in the next three years to expand its production capacity.
Core shortage crisis
This time the core shortage crisis mainly originated from the new crown pneumonia epidemic. First of all, many companies have canceled chip orders in consideration of the future decline in demand, so that suppliers have begun to reduce production capacity. However, the closure of homes due to the epidemic has led to a surge in demand for consumer electronic products.
The core shortage crisis later escalated due to many reasons, including a fire in a semiconductor company and weather problems. Paul Triolo, an analyst at the consulting firm Eurasia Group, said that a major intergenerational technological change has occurred in the technology industry, and this demand has caused an unprecedented semiconductor supply crisis.
Triolo also said that as long as there is a diversified supply, it does not matter where the chips are produced. He believes that the core shortage crisis will continue for some time, and the industry needs to come up with long-term solutions to eliminate the problem of excessive manufacturing concentration. This problem actually appeared before the core shortage crisis.
Rodrok also said that Cisco does not want to see an excessive concentration of semiconductor manufacturing, otherwise some factors will lead to a recurrence of the core shortage crisis similar to today, such as weather disasters, technical failures, geopolitics, etc. Cisco hopes to have semiconductor production locations. More options.
Recently, Cisco completed a $4.5 billion acquisition of chip design manufacturer “Acacia Communications.” Rodrike said that Cisco will not use this acquisition to enter the field of chip manufacturing. “We are not a chip manufacturing company. This is not our core competitiveness. Companies engaged in chip manufacturing have better equipment. We will keep close with them. Cooperation.”
At present, the investment in building a chip factory is huge, and the existing production capacity is running at full capacity, so if the new demand is to be met, it will take some time to wait.
Rodrok said that like other technology companies, Cisco’s network equipment is heavily dependent on a stable supply of a series of semiconductors. However, some companies in the industry are worried that they will encounter a shortage again, so a large number of orders increase inventory stocking, which further worsens the core shortage crisis.
(Via)
