From Tablets to Sex Toys, the Chip Shortage Is Far-Reaching
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Scarcity means higher prices for consumers, longer waits for goods, empty store shelves and swaths of the business world racing to secure whatever supply they can.
The global chip shortage hobbled auto makers world-wide. Now, other industries are feeling the squeeze.
It has hit makers of kitchen appliances, heavy-equipment, servers and adult toys. It really is confounding multinationals to startups. Even companies that don’t use chips as their core business, such as for example freight operators and retailers, end up affected. The scarcity means higher prices for consumers, longer waits for goods, empty store shelves and swaths of the business enterprise world racing to secure whatever supply they are able to.
The chip famine first hit auto makers late this past year once they underestimated demand during the pandemic. But as car makers ramped up orders, other industries saw the parts queue lengthen and increased their own purchasing. Demand for gadgets stayed hot. Now chip makers can’t keep pace, driving up prices for parts, thinning out supply and spurring panic buying.
The tight supply for most chips will probably persist through this season, companies say. The shortfalls are creating missed work at home opportunities, just as the global financial recovery is gaining momentum after a pandemic-led slowdown.
They also have contributed to escalations in the price tag on recycleables for electronic goods in recent months. An index measuring the cost of inputs for electronics companies in March soared to the best level recorded in more than 2 decades of tracking, according to IHS Markit, market researcher.
The global chip shortage hobbled auto makers world-wide. Now, other industries are feeling the squeeze.
It has hit makers of kitchen appliances, heavy-equipment, servers and adult toys. It really is confounding multinationals to startups. Even companies that don’t use chips as their core business, such as for example freight operators and retailers, end up affected. The scarcity means higher prices for consumers, longer waits for goods, empty store shelves and swaths of the business enterprise world racing to secure whatever supply they are able to.
The chip famine first hit auto makers late this past year once they underestimated demand during the pandemic. But as car makers ramped up orders, other industries saw the parts queue lengthen and increased their own purchasing. Demand for gadgets stayed hot. Now chip makers can’t keep pace, driving up prices for parts, thinning out supply and spurring panic buying.
The tight supply for most chips will probably persist through this season, companies say. The shortfalls are creating missed work at home opportunities, just as the global financial recovery is gaining momentum after a pandemic-led slowdown.
They also have contributed to escalations in the price tag on recycleables for electronic goods in recent months. An index measuring the cost of inputs for electronics companies in March soared to the best level recorded in more than 2 decades of tracking, according to IHS Markit, market researcher.
Source: https://www.wsj.com