Intel CEO doubles-down on multi-year chip shortage

The ongoing global chip shortage will trudge on for some time to come, according to Intel CEO Pat Gelsinger, with the major issues unlikely to see any real solutions for several years.

The semiconductor shortage, which is affecting chip production around the world, is a major issue for the hardware industry. While efforts are being made to try and fix the issue, Intel's CEO doubts it will be rectified anytime soon.

In a virtual Computex session, Gelsinger said the work-from-home trend prompted by COVID-19 has led to a "cycle of explosive growth in semiconductors," which has put a strain on global supplies, reports Reuters.

"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," he said.

In April, Gelsinger believed the shortage could take "a couple of years" to fix. At the time, he also said Intel was planning to alleviate some strain in the automotive sector by producing chips for cars within six to nine months.

Gelsinger also partially elaborated on Intel's $20 billion plan to expand production, including two factories in Arizona, and offering its services to companies like Apple for chip production. "We plan to expand to other locations in the U.S. and Europe, ensuring a sustainable and secure semiconductor supply chain for the world," the CEO mentioned.

The comments from the Intel CEO offer a pessimistic view on how long it will take for the shortage to be rectified. In April, it was thought that chip production won't ease off until 2022 or later.

The issue has already triggered hefty investment, aside from Intel. GlobalFoundries, the third-largest chip producer in the world, planned to use $1.4 billion to ramp up production, while Apple chip partner TSMC expects to pump $100 billion into expanding capacity over the next three years.

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12 Comments

sdw2001 17459 comments · 23 Years

About 3 years ago

No way he believes that. Seems to me that he is publicly justifying why they are putting the resources into production like they are.

genovelle 1481 comments · 16 Years

What stood out to me was Intel investing 20 billion and Global Foundries 1.4 Billion, while TSMC is investing 100 million.

GeorgeBMac 11421 comments · 8 Years

As U.S. downstream production is being affected, Trump's sanctions need to be looked at very closely -- especially those targeting Chinese chip production. Weirdly, these sanctions were supposedly put in place for "National Defense" -- but are now working against us as U.S. prices go up and U.S. factories shut down.

U.S. sanctions on chipmaker SMIC hit at the very heart of China’s tech ambitions

The U.S. government has reportedly imposed restrictions that require suppliers to get an export license to sell certain equipment to China’s biggest chipmaker SMIC.
The move threatens to hit at the heart of China’s plans to boost its domestic semiconductor industry, a need that has been accelerated by the trade war with the U.S.
SMIC is seen as a critical part of China’s ambitions and the commerce department’s sanctions could hold back the company’s development for several years.

https://www.cnbc.com/2020/09/28/us-sanctions-against-chipmaker-smic-hit-china-tech-ambitions.html

mwhite 287 comments · 9 Years

genovelle said:

What stood out to me was Intel investing 20 billion and Global Foundries 1.4 Billion, while TSMC is investing 100 million.

You need to re-read it TSMC is investing 100 Billion not Million....

tmay 6455 comments · 11 Years

GeorgeBMac said:

As U.S. downstream production is being affected, Trump's sanctions need to be looked at very closely -- especially those targeting Chinese chip production. Weirdly, these sanctions were supposedly put in place for "National Defense" -- but are now working against us as U.S. prices go up and U.S. factories shut down.

U.S. sanctions on chipmaker SMIC hit at the very heart of China’s tech ambitions
The U.S. government has reportedly imposed restrictions that require suppliers to get an export license to sell certain equipment to China’s biggest chipmaker SMIC.
The move threatens to hit at the heart of China’s plans to boost its domestic semiconductor industry, a need that has been accelerated by the trade war with the U.S.
SMIC is seen as a critical part of China’s ambitions and the commerce department’s sanctions could hold back the company’s development for several years.
https://www.cnbc.com/2020/09/28/us-sanctions-against-chipmaker-smic-hit-china-tech-ambitions.html

Nothing in the link that you posted indicates, at all, that SMIC is in the supply chain for U.S. manufacturers.