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Logitech CEO Says Chip Shortage Could Last for Up To a Year (reuters.com) 64

Posted by msmash from the up-next dept.
The global shortage of semiconductor chips could last three to six months, Logitech Chief Executive Bracken Darrell told Swiss newspaper Finanz und Wirtschaft, with some industries facing shortages of up to a year. From a report: "Like others we have felt the shortages, but we have been able to cushion them well," Darrell said in an article published on Friday. "It takes time to ramp up production but in the meantime, prices have also adjusted."
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Logitech CEO Says Chip Shortage Could Last for Up To a Year More

Logitech CEO Says Chip Shortage Could Last for Up To a Year

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  • Still havent figured out why there's a shortage (Score:4, Insightful)

    by OverlordQ ( 264228 ) on Friday May 28, 2021 @12:21PM (#61431608) Journal

    Were there production shutdowns due to covid? Some other problem? Did demand skyrocket? The complete shutdowns didn't last long enough to cause a multi-year backlog.

    • Re: (Score:3, Informative)

      by ShanghaiBill ( 739463 )

      Were there production shutdowns due to covid?

      Yes.

      Did demand skyrocket?

      Yes.

    • Like the gasoline shortage that resulted from the Colonial Pipeline shutdown, a significant part of the problem is component hoarding.

    • Re: Still havent figured out why there's a shortag (Score:5, Interesting)

      by BetterSense ( 1398915 ) on Friday May 28, 2021 @01:27PM (#61431794)
      There's no chip shortage. I work in the industry. Production has been gradually increasing worldwide and most fabs are expanding. There have been no order blackouts or even excessive lead-times.

      I know this firsthand because I work for a tier 1 supplier of fab equipment. Business is steady but not crazy.

      Also notable, there haven't been any big disruptions recently like the tsunamis, or any unplanned power outages (the power outage at Samsung in TX was a planned shutdown because the state warned them in plenty of time, so it was a nothingburger. They mostly just lost the few days of production while the power was out; insignificant to the market. Unplanned outages like the one that happened in Korea a few years ago scrap most of the wafers which is a 60-90 days of loss, which can cause a ripple in chip prices).

      Whenever you hear "because of the chip shortage..." you can mentally translate "because we failed to order chips...". I'm sad to say it's really that simple. There's never been a time when the fabs weren't taking orders, and lead times are well-advertised and not actually that crazy. But if you don't order chips, the lead time is infinite. The "chip shortage" is a smokescreen to cover the fact that certain industries and companies really really fucked up by...not ordering chips. Some really well-paid people made some bad calls about the real impact of COVID, and planned poorly. That's not a chip shortage.

      • Re: Still havent figured out why there's a shortag (Score:4, Informative)

        by ArchieBunker ( 132337 ) on Friday May 28, 2021 @01:38PM (#61431840)

        You're full of shit. This is a supply chain ripple effect we're feeling. I already posted an example of year long lead times. So huge suppliers like Digikey simply failed to order inventory?

      • I know this firsthand because I work for a tier 1 supplier of fab equipment. Business is steady but not crazy.

        And how does mean there is no chip shortage for your customers? You do know that if there was a shortage, your product which is a capital expense would not experience a swing?

        Also notable, there haven't been any big disruptions recently like the tsunamis, or any unplanned power outages (the power outage at Samsung in TX was a planned shutdown because the state warned them in plenty of time, so it was a nothingburger.

        Samsung has said that they lost $268M in damaged products during the February shutdown which according to you was planned. We should believe you over Samsung?

        I'm sad to say it's really that simple. There's never been a time when the fabs weren't taking orders, and lead times are well-advertised and not actually that crazy. But if you don't order chips, the lead time is infinite. The "chip shortage" is a smokescreen to cover the fact that certain industries and companies really really fucked up by...not ordering chips. Some really well-paid people made some bad calls about the real impact of COVID, and planned poorly. That's not a chip shortage.

        TSMC says there is a chip shortage. Sony says there is a chip shortage. Microsoft says there is a chip shortage. Honda, Ford, etc. say there is a chip shortage. You: There's no ch

        • Those companies are not lying. THEY have a chip shortage vs. their demand, because they didn't manage their inventory correctly...they didn't order enough chips to supply their needs. If they don't place the orders we don't start the wafers.
          • Microsoft, Sony, Logitech, AMD, NVidia. Etc all did not manage inventory. Many companies in multiple industries. Sure . . .
        • About the Samsung shutdown: I don't doubt their $265m figure, although do realize they count every expense that can plausibly be attributed to the shutdown in that figure... that's their insurance-claim number; they didn't lose $265m of wafers. And second, even if the full $265m was wafers, that IS STILL a nothingburger--the market for NAND memory is like 10 billion dollars.

          • About the Samsung shutdown: I don't doubt their $265m figure, although do realize they count every expense that can plausibly be attributed to the shutdown in that figure... that's their insurance-claim number; they didn't lose $265m of wafers.

            Samsung reported $268M loss in damaged products at the Austin fab. That is not "expenses". They reported lost $268M in lost product. That is what Samsung has said. You keep trying to misrepresent what they said.

            And second, even if the full $265m was wafers, that IS STILL a nothingburger--the market for NAND memory is like 10 billion dollars.

            In one month due to one event, Samsung semiconductor lost $268M in product. If it is a nothingburger, you would pay for their losses. Basically you were wrong, dead wrong about their planned shutdown and you are trying to deflect facts because it does not fit with your false narrative.

      • 'Whenever you hear "because of the chip shortage..." you can mentally translate "because we failed to order chips...". '

        Sure, there are a few cases of those. But there are more cases of "Our lead time for new orders is now 3x our previous orders" and "Our vendor now requires us to provide 1 year of substrates up front to make sure their supply chain doesn't dry up".

        "there haven't been any big disruptions recently"

        The industry has been supply constrained for years. "Shortage" is not a synonym for "suddenly".

    • Re:Still havent figured out why there's a shortage (Score:5, Informative)

      by Whateverthisis ( 7004192 ) on Friday May 28, 2021 @01:38PM (#61431842)
      You got a few snarky responses, but it's a legitimate question and even internet research can't quite explain the issue.

      Supply chains are quite complex; it's a field where when everything's working correctly no one cares, but when it falters it falters big, takes time to course correct, and everyone pays attention. In particular the pandemic created 2 major industry changes that led to this:

      1) Car makers assumed that the pandemics and lockdowns would reduce people's mobility and thus reduce demand for cars. They lowered their production plans on this assumption, which in turn reverberated through their supply chains to a much lower demand for parts. This turned out to be not true, demand for cars was steady and their inventories were depleting as they weren't producing. So they tried to ramp up, but found they couldn't get parts all of a sudden.

      2) Electronics companies assumed that the pandemic and lockdowns would increase the demand for at-home electronics and services for work from home and other automated tools. They ramped up production, and found that the chip foundries had available capacity and booked it to produce IoT devices, computers, televisions, etc.

      The problem with supply chains is they turn slowly, and complex devices like cars often hide the lynch pins in the chain. The issue here is when people think of chips they think of Intel or AMD; computer processors. The fact is cars have thousands of chips in all of their parts, MEMS sensors that measure tire pressure and brake-fluid quality, and very basic processors, ASICs and other simple things, that are not complex Intel processors but are instead designed to just process to do a few things, like read the output of the sensor, calculate what it means, and turn on a light on the dashboard. The auto industry under-appreciated just how many of these chips were used in virtually every part in the car when they turned off their supply chain, and the foundries, finding excess capacity, sold it to who wanted it, the electronics companies who were ramping.

      So when the auto industry came back and asked for parts, they found all across the board their 2nd, 3rd, and 4th tier vendors couldn't get enough chips to make enough parts to get car assembly back up to speed, because the foundries were booked out by electronics companies; the foundries had already made other commitments. So they book capacity, but it's a year or more out. Meanwhile the foundries are trying to bring new lines on, but a lot of these much older chips are on older 8" lines, which are mostly dedicated towards legacy chips. Moving these older chips to larger 12" nodes is really a non-starter, because the tools are different (more advanced in some ways) so you practically have to go through a whole R&D process just to get a legacy chip on a bigger wafer with newer tools and slightly different processes. In many ways the 8" equipment, particularly in MEMS, is being phased out, so the foundries can buy more tools but they're often 6 to 9 month lead time plus the new cleanroom, training staff, etc.... takes time to get that going. And the foundries will only build capacity if they know it's going to last and not just deal with a demand surge now, so that's all part of the issue.

      So in the end, it's the auto industry (which might be the biggest consumer of chips on a pure numbers basis) making an incorrect assumption and trying to correct for it that caused this whole issue.

      • Parent is 100% correct on all points economical and technical.

        Industry steps on its crank, screams "chip shortage!" I assure you the fabs have been happy to build them chips the entire time but fabs don't build chips without purchase orders; sorry.
      • Being responsible for certain things in such a fab for automotive products, there are some more/additional funky effects. Last year, certain chemicals were hard to come by for some time. So that may have impacted some fabs, you can't just switch to a different supplier in the automotive business. Automotive and other companies now and for some time, seem to order more, just to be able to get what they really need. Think "well if you can't deliver that, can I get at least half...?" If all chip makers would d

    • Were there production shutdowns due to covid?

      Yes, all over the world. In many industries.

      Some other problem? Did demand skyrocket?

      Yes demand skyrocketed as people bought desktops and laptops. Accessories probably were bought too.

      The complete shutdowns didn't last long enough to cause a multi-year backlog.

      Most manufacturing is just in time which means any delay in any step cascades to the finished product being delayed. One major industry that has not recovered is global shipping. Passenger airplanes carried cargo too, and that industry is no where near the same number of flights. Cargo air freight can only compensate so much. From what I know that means shipping via

    • Production shutdowns: Yes
      Other problems: Yes. Because various suppliers of required production materials also shut down(or diverted) production.
      Demand skyrocket: Yes, quite a few home offices being set up, more people staying home and getting on the internet, leading to more demand.
      Complete shutdown leading to multi-year backlog: Quite possible, actually. Due to "just in time" production philosophy, we don't actually have a lot of excess production capability, because that's expensive. They might have

    • There was already a shortage. The market has been supply constrained for a decade or more.

  • Well, if a keyboard and mouse maker (Score:3)

    by Rosco P. Coltrane ( 209368 ) on Friday May 28, 2021 @12:41PM (#61431678)

    has deep insight into the global chip market, it must be accurate.

    • From Logitech's standpoint, their chips are closer to commodity chips and not cutting edge like a RTX 3080 or an Apple M1 who would pay a premium for those chips. If Logitech has had shortages, it is logical that the entire industry has had shortages.

  • They aren't joking (Score:5, Informative)

    by ArchieBunker ( 132337 ) on Friday May 28, 2021 @12:43PM (#61431684)

    Here is a perfect example. I need an LM317HV for an upcoming project. Look at the delivery dates quoted by Mouser:

    https://www.mouser.com/Product... [mouser.com]

    May of 2022! They are in stock at Digikey but the other components I need are not. Oh and if you're buying common semiconductors on eBay or AliExpress, they're fake. Every single one is not what it claims. Opamps, voltage regulators, jfets, mosfets, bipolars, all rebranded to test ok but will fail when replacing an original. Open up a big power transistor and you'll see the tiny die inside is much smaller than the legitimate part. Those fancy opamps you think are AD797s are just LM741s with a new label.

    • Re: (Score:2)

      by Arethan ( 223197 )

      For me it shows: "Stock: 0 On Order: 4,290Expected 7/22/2021"
      That's a bit sooner than May 2022. Try pressing F5

    • Re: (Score:1)

      by Anonymous Coward

      There are over 100K of those in stock at TI. Why don't you order some there?

      • Because I only need one. So yay $10 shipping on a $2 part.

        • Re: (Score:2)

          by tlhIngan ( 30335 )

          Because I only need one. So yay $10 shipping on a $2 part.

          The LM317 is a jellybean opamp. it doesn't hurt to have a bunch of these on hand for experimentation purposes.

          It's like stocking a decent quantity of E10 resistors, with perhaps larger quantities of the 1K and 10K resistors.

          They're commonly used parts. Having extras on hand isn't a problem.

    • I just checked your link.

      I think they heard you, it's now "Expected 7/22/2021"

      Yo Grark

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