How current world affairs are affecting semiconductor and PCB supply chains

It’s no secret that effects of the pandemic have led to shortages across many industries in the UK and around the world. Whilst the supply chain was slowly beginning to catch up, recent geopolitical events have only added to the crisis.

One of the main sectors that’s been affected by such issues is the technology industry and there are delays in supply chains around the world for components. With so many goods using increasing amounts of technology, there has been a noticeable impact in virtually every country.

We’ll take a close look at how the semiconductor markets have been especially affected and what the outlook is for supply issues.

The global chip shortage

Semiconductors (chips) are vital elements in technology such as smart phones, computers and cars. The current supply and demand problem means there’s very little supply and too much demand, creating a huge shortage across the world. An increase in electronic-based technology including smart devices, electric vehicles programming systems, it means there’s even greater pressure on this market.

As production slowly gets back to normal, severe shortages should reduce over time, though it could take months to clear the back log.

What’s the outlook?

As industries battle through the chip crisis, the European Commission announced a £36 billion investment in Europe’s semiconductor industry. As most semiconductors are manufactured in Asia (specifically Taiwan), this was done in the hope of boosting Europe’s presence in the market. Whilst this might not solve the immediate problem, it puts the continent in a better position for future manufacturing supply.

Many experts agree that the shortage could last another year and there could end up being a bigger supply than demand in the not-too-distant future. However, that doesn’t solve the current problem.

What other components are affected?

Across the world, printed circuit board supply shortages are also having a knock-on effect to electronics industries. PCBs support and connect electronic components but the main issue with the shortage is the lack of copper foil. An unprecedented demand following the pandemic has meant industries are struggling to get hold of them. This also led to a huge increase in prices, pushing up the cost of related materials alongside.

Similar to semiconductors, the industry expects the shortage to last for another year or so, until the sector has caught up with demand. Whilst many industries are affected, the automotive sector has arguably suffered the most, with dealers having to warn customers of up to a year delay in sourcing vehicles in some circumstances.

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