semiconductor chip shortage

What is the Semi-conductor chip Shortage 2021?

What is the Semi-conductor chip Shortage 2021? The Semi-conductor chip Shortage 2021 will affect the cost of most products that you buy, but it will be felt in different ways depending on the product you are buying and the manufacturer that produces it. For example, if you are buying any type of electronic product like laptops, cell phones, game consoles, or computers then the price of these products will increase by at least 5% due to this shortage in chips.

If you are buying any kind of appliance-like washers, dryers or dishwashers then the prices may go up by over 10% due to this chip shortage in 2021. We can already feel the effect that it is having in the Car Industry with a shortage of cars in the dealerships. But what do we know about the semiconductor chip shortage so far? And what could cause this current one? Let’s dig in!

With a chip shortage, everything seems to cost more. But, will it affect products for consumers? Whether you’re looking to purchase a new television or a shiny new laptop computer, if your budget is already tight then you may be surprised to learn that there are several hidden costs associated with your purchase that you might not have initially considered.

In particular, those costs might now be higher thanks to a semi-conductor chip shortage. To better understand how shortages may impact your wallet and your purchase, let’s first take a look at what exactly a chip shortage means and why it has industry experts so concerned.

Semiconductor Chip

What is the semi-conductor chip shortage?
The semiconductor chip shortage has been affecting people around for a while now. Everyone who buys any type of product with a computer or electronic inside it has been affected by it in some way.

But what is causing there to be so many problems in the production of these chips? Semiconductor prices have gone up and continued to go up over time due to new innovative products coming out like laptops, tablets, Smart Phones, and even cars that use computers and require semiconductors.

Some also believe that environmental issues may also be contributing to why we are experiencing such a shortage of chips; especially since we need such large amounts of silicon (the main component of semiconductors) in order to create semiconductors.

Why are they in short supply in 2021
The problem with semis now and heading into 2021 has to do with multiple factors. For one, many companies such as Apple and Samsung are transitioning to smaller process nodes with FinFET technology, which requires a completely different design compared to planar nodes.

This is leading to a lack of silicon foundries that can produce chips with high yields on new process nodes. At 16nm/14nm and 10nm/7nm, many foundries just aren’t sure if they can deliver enough yield at those process sizes for customers like Apple to commit mass production capacity.

In other words, there has been a high demand for these components due to the higher production of products such as computers, laptops, etc. which is also a pandemic effect.

Who will be most affected
The chip shortage will affect everyone, but it will impact certain groups more than others. Most consumers will be affected in a very noticeable way because everything we use and consume contains these chips.

If manufacturers can’t get their hands on enough integrated circuits (ICs), they won’t be able to produce many of our favorite products—from phones and tablets to laptops and even cars.

There are some exceptions: Chips that don’t contain copper or that aren’t made by an Intel competitor should still be available.

Will the chip shortage continues in 2022
So far no, there won’t be a semi-conductor chip shortage in 2022. In fact, according to a report from iSuppli, it’s expected that production will grow from an estimated 91 million units in 2020 to 121 million units in 2022.

This puts us on track for what research firm Gartner calls peak demand. Another reason we may not see shortages: Chipmakers continue to seek out new ways of making chips smaller and cheaper — which increases yields and helps drive down costs — so their profit margins remain steady or improve, iSuppli said.

But, we will have to wait and see. we can`t discard the idea that the shortage could continue, some experts are saying that it could be done a year from now.

Will it affect the cost of Products in 2021
While it may seem like a good idea to stock up on chips before they become scarce, it’s not. Demand for semiconductors grows exponentially each year and if you haven’t already noticed, there has been a shortage of these products over recent years.

With a worldwide economic boost comes an even higher demand for things like computers, smartphones, and other electronic devices. Over time, as more consumer items run on semi-conductors, its demand will only continue to grow—and so will price hikes. The last two weeks have been bad enough as it is.

To protect yourself from these impending increases in the cost of goods sold (COGS), you should start thinking now about making smart decisions that won’t affect your profit margins drastically down the road.

Conclusion
The semi-conductor shortage in 2021 has caused a major blow to many computer manufacturers. The way we use our computers and other electronic devices has drastically changed over time.

We have completely changed from wired to wireless technology. Since computer manufacturers started using more and more wireless components, they had to significantly increase their orders for them and that created a massive shortage of semiconductors.

This shortage forced many computer manufacturers to raise their prices on most of their products which in turn increased inflation in 2021 by 3%! Consumers can expect even higher inflation rates over time as demand continues to outpace supply.

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