CEO of Intel Corp said that the global shortage of semiconductors chip might last for several more years. Meanwhile, the effect of the semiconductor shortage is starting to spread from auto production lines to consumer electronics.
The semiconductor industry noted a severe increase in demand during the COVID-19 pandemic. During a virtual session of the Computex trade show, Pat Gelsinger said that the pandemic brought a “cycle of explosive growth in semiconductors”, Reuters quotes.
One of the main contributors to the rising demand for semiconductors is work and study-from-home. This further translates into more demand for electronic devices. This slowly puts a strain on global supply chains.
“But while the industry has taken steps to address near term constraints it could still take a couple of years for the ecosystem to address shortages of foundry capacity, substrates and components.”
According to Gelsinger, chip shortage might linger “a couple of years” until it abates, in an interview with The Washington Post back in April. To prevent the issue to grow any bigger, Gelsinger planned to start chips manufacture within six to nine months to address shortages at U.S. car plants.
Intel: chip production in the future
Intel unveiled a $20 billion plan in March to expand its advanced chip production capacity. The plan includes the establishment of two factories in Arizona and opening its plants to outside customers.
“We plan to expand to other locations in the U.S. and Europe, ensuring a sustainable and secure semiconductor supply chain for the world,” Gelsinger said. The man, however, didn’t give further explanation on the plan.
Intel’s plans will put the company in a head to head competition with two of the biggest semiconductor companies. The two companies are Taiwan Semiconductor Manufacturing Co Ltd and South Korea’s Samsung Electronics Co Ltd. These two companies have started to shift their centre of gravity from the United States to Asia. Both companies commenced with the strategy as a way to dominate the industry. Asia is chosen because the continent is currently the biggest manufacturer of advanced chips.