Posted on 06/01/2021 4:44:43 PM PDT by blam
Intel CEO Pat Gelsinger Says Semi Shortage Could Last “A Couple Years”
Brace for more pessimistic news about the global semiconductor shortage…
Intel is now going on the record and doubling down on statements that its CEO made on 60 Minutes earlier this year, stating that it could take “several years” for the current supply shortage of semiconductors to be resolved.
CEO Pat Gelsinger said that the pandemic-inspired “work from home” trend caused a “cycle of explosive growth in semiconductors”, according to 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,” Gelsinger commented.
Gelsinger also reiterated Intel’s plans to expand: “We plan to expand to other locations in the U.S. and Europe, ensuring a sustainable and secure semiconductor supply chain for the world.”
Intel is trying to keep pace with Samsung and Taiwan Semiconductor – both of which also have plans to expand, including into the U.S. – to increase semi production.
We noted in mid-May that TSMC had plans of “doubling down” and vastly increasing its investment for production in Arizona. The chipmaking giant said at the time it was “weighing plans to pump tens of billions of dollars more into cutting-edge chip factories in the U.S. state of Arizona than it had previously disclosed”.
The company had already said it was going to invest $10 billion to $12 billion in Arizona. It now appears to be mulling a more advanced 3 nanometer plant that could cost between $23 billion and $25 billion. The changes would come over the next 10 to 15 years, as the company builds out its Phoenix campus.
The move would put TSMC in direct competition with Intel and Samsung for subsidies from the U.S. government. President Joe Biden has proposed $50 billion in funding for domestic chip manufacturing.
Commerce Secretary Gina Raimondo, in early May, called for a “major increase” in U.S. production capacity of semiconductors. She commented: “Right now we make 0% of leading-edge chips in the United States. That’s a problem. We ought to be making 30%, because that matches our demand. So, we will promise to work hard every day, and in the short term also see if we can have more chips available so the automakers can reopen their factories.”
“In the process of building another half a dozen fabs in America, that’s thousands of Americans that get put to work,” Raimondo commented.
In May we noted how automakers were being forced to leave some high tech features out of new vehicles as a result of the semi shortage. Days before that, we pointed out “thousands” of Ford trucks sitting along the highway in Kentucky, awaiting semi chips for completion of assembly.
We also noted recently that Stellantis said there would be “no end in sight” to the shortage and that the company was making changes to its lineup, including changing the dashboard of the Peugeot 308, to try and adapt to the crisis. Ford was another auto manufacturer to slash its expectations for full year production as a result of the shortage this year.
The chip crisis has hit the auto industry so hard that it has forced rental car companies – already under immense pressure from ride sharing companies – to buy up used cars at auction to fulfill their inventory needs, Bloomberg also noted last month.
Intel’s CEO, speaking on 60 Minutes last month, had already suggested it could be a while before things are back to normal. He said then: “We have a couple of years until we catch up to this surging demand across every aspect of the business.”
(snip)
But computer sales were and are not “up” by any large numbers. And any “remote” employee already had a PC at their desk that they could take home for the shutdown.
I call BS. I think this is a quiet Cold War maneuver from China myself.
In many cases, the companies ordered laptops instead of letting them take the desktops home. Further, many people didn’t have anywhere to put a desktop and there’s also the issue of possibly having to move the desktop several times as (projected) waves of COVID came through, not something desktop computers like. Many corporate desktops don’t come with WiFi either, so that would be another nightmare to deploy. And on top of that, a lot of companies simply needed new computers and this was a good time to get them.
Agreed.
I want to hear one of these execs explain why. With the exception of the two fab fires there is no reason. Demand is basically the same as it was.
Obviously this is the ultimate technology trap. Only 3 companies are big enough to compete in this market at this level. Some better way of making the computers we use needs to be invented.
Increased price is the only long term solution to shortage.
Everything will go up substantially.
Everything.
Substantially.
“I think this is a quiet Cold War maneuver from China myself.”
The vast majority of chips in the supply chain do not come from China.
Honda is manufacturing cars using one semiconductor to park them in the lot until the rest arrive (6months)
I’m not denying there’s a shortage.
I’m saying it’s NOT because a lot of people bought computers that they weren’t expecting.
Something or some country is disrupting supply.
I agree - something else is up. You don’t need a “new” computer for most work from home setups...even pretty old computers can handle that.
There is very little real need for a 3 nanometer chip. With cellphones getting bigger, and most laptops spending their lives plugged into the wall, how small and light do most folks really need?
I’ve bought two laptops for work from home. And the company’s seat licensed machines were still mounted at work last time I went into the office at the end of last year. Now, I could have given control of my home desktop to the company to manage, but for some reason I didn’t want to give them access to my financial accounts and personal emails. You might have fewer concerns about privacy.
No - my company allowed us to take home our PCs and had recently been switching to laptops with docking stations to facilitate “at home” work - which just happened to coincide with the pandemic.
Before that we could VPN to work onto our desktops from the home PCs but that was deemed “insecure” so, after the pandemic started, they locked down the laptops with monitoring software and those are the only machines that are allowed to access the infrastructure.
Needless to say - I’ve ceased any and all personal activity on work equipment. (Not that I did much but I would use it to occasionally make amazon purchases or check credit card statements - it’s not like I was using it for pr0n :) but now I’ve completely ceased all personal activity on the work PC as their monitoring breaks SSH encryption intentionally)
One annoyance about all this is that we’re a 24/7 support operation so I can get calls at all times of the night for service issues - having VPN access meant that, even if I were on vacation, I could access the systems with either my smartphone or a small laptop to triage or affect repair. (We had both VPNs and 2FA authentication with yubikeys for this)
But now that’s completely impossible as I MUST have the work laptop with me to access any part of the corporate network - either at home or on vacation.
Pat is the best CEO since Paul O.
He was the lead architect on the 486.
Hopefully he will dump the diversity nonsense and project in-fighting that crippled Intel and they can get back normal.
I was making chips at start-up National Semiconductor when Intel started as a company up on Middlefield road. And, I was working at Signetics in R&D when AMD started up just down the street from us, Larry Stinger and others, I think it was.
I wound up retiring from Texas Instruments at the end of 1994. Yes, I did meet Jack Kilby there once.
Wonderful, fulfilling career.
When I worked for government, I had an issued laptop that I could use anywhere (2 factor authentication) with full access and there was a separate login we could use from home that worked for emails, and a few other things, but couldn’t access the databases - a pain to use and you couldn’t do much work, so I only used it a few times. When I traveled for work I carried a personal laptop as well (later a tablet).
Current job has been BYOD, but appear to be headed toward your setup. No travel, however.
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