Global Semiconductor Shortage Updates and Q3 Sales

The semiconductor industry is facing lengthy shortages along with plans to promote growth. From a new plant to record sales, read our blog to learn more.

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Global Shortage Industry Update

The world is all of a sudden approaching the holiday season, and the season also brings growth for sales, new semiconductor plants, and updates on the shortage. As time goes on, the depth of the impact of the pandemic on the supply chain is becoming more clear. Despite the many setbacks, the industry continues to progress and, above all, move forward. From sales to new plants, there is much to look forward to despite the difficulties. Read on to learn more about these upcoming changes.

Global Semiconductor Sales in Q3

The third quarter of semiconductor sales were more than impressive. SIA, or the Semiconductor Industry Association, noted this in a recent report. The number of semiconductors shipped during this quarter exceeded any quarter in the market’s history. Sales increased year-to-year and month-to-month for the Americas, Europe, Asia/Pacific, Japan, and China. Worldwide sales of semiconductors reached an impressive $144.8 billion during the third quarter. The increase in sales is a good indication of the global demand for semiconductors.

Inside TSMC’s New Plant in Phoenix

Phoenix is gearing up to be the home of TSMC’s new plant. TSMC, or Taiwan Semiconductor Manufacturing Company, plans to begin production in 2024 at the new plant. The 12 billion dollar plant brings production to the U.S. and is part of the company’s plan to invest $100 billion over three years.

TSMCs goal is to increase production overall and help push against the current raging shortages. Semiconductors produced in this plant will be used in everything from phones to jets. The industry anticipates the grand opening of this plant as it will allow the U.S. to better compete with overseas production.

Currently, TSMC is exclusively responsible for providing the semiconductors inside Apple products. TSMC leads in producing these exclusive products and is responsible for 92% compared to Samsung’s 8%. The company dates back to the 1980s and has since seen much success. The Phoenix location gives many hopes for the U.S.’s involvement in semiconductor manufacturing.

Global Semiconductor Shortage Worsens

To no surprise, the global semiconductor shortage is continually worsening following the onset of the pandemic. While the shortage initially impacted the automotive industry, other industries are feeling it now as well. Not only is the shortage not going away as some initially hoped, but it also seems to be getting continually worse.

The last few months have seen product delays, loss of sales for many companies, and more. This is all due to the growing need for semiconductors accompanied by the ever-increasing deficit. As far as an end date? There does not seem to be one in the near future.

According to Brandon Kulik, head of Deloitte’s semiconductor industry practice, the shortage is indefinite and will certainly not resolve in a matter of months. Some companies, like General Motors, have even stopped production due to the shortage.

With the days before Christmas quickly dwindling, there has been much discussion regarding how this may impact gifts. The fear is not without cause, as many electronic products rely on the same parts experiencing shortages. Nintendo, the popular Animal Crossing and Nintendo Switch creator, just recently warned the semiconductor shortage is projected to cause disappointment for those who haven’t already ordered their products. With long wait times for parts, there may be many IOUs under the tree this year.

While the shortages continue to cause issues for many, the semiconductor industry isn’t backing down. With plans to invest and increase production, there are brighter days ahead. Though the shortage is causing issues for automakers and even game designers, there is hope for what’s to come. Need help securing your supply chain? Velocity is here for all of your unique needs. When the shortage is a distant memory, and many are looking to deal with their excess and obsolete components, we will be ready to meet you where you are.

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