Arm CEO Says Industry is Spending $2B a Week to Address Chip Crisis (eetimes.com) 20
Talking at the Web Summit in Lisbon, Arm CEO Simon Segars said this chip-supply crisis was the worst he'd ever seen (according to an EE Times article shared by Slashdot reader dkatana):
The most important thing to do to get out of the woods in this situation and minimize similar ones in the future, he argued, is to improve collaboration between all players in the ecosystem. "We need better collaboration across all players in the supply chain. So, make sure we understand the bottlenecks and build resilience into this supply chain in a steady state that works okay. But when you get an event and obviously the pandemic was a Black Swan event, like no other, it froze things off the hillside, and it's very hard to recover."
Segars is optimistic that current and future investments would ease the supply chain in the short term, but he is also cautious about not creating huge expectations. "About $2 billion a week is going to be spent for the next couple of years to add capacity and build new facilities. And that's going to add about 50 percent additional capacity over the next five years...."
Segars predicted next year's Christmas might be much better for gift givers, but that consumers might still consider starting shopping early. And prices might not come down for a while. What is essential, Segars said, is to be patient, collaborate and invest. "Where are we going to be next Christmas? I expect these supply chain constraints to be a little better, but [they] won't be completely fixed because this isn't a short-term problem with a short-term solution. Billions of dollars are going to need to be spent in the coming years. And the decisions that we make today are going to affect the supply of this life, critical materials, semiconductors, over the next decade.
"Will we get this right? Will we spend enough? We spent too much, but we accidentally break the industries? That remains to be seen. That is the challenge that the industry is stepping up to" he added. "And in collaboration, across suppliers and customers and governments, we absolutely have to get it right!"
Segars also pointed out that it's hard to expand wafer production because there's so many different chemicals involved. "I mean virtually the whole periodic table that is used in making semiconductors. You need industrial style, very pure chemicals to feed into these factories downstream... So you need much more than just a chip factory to address these supply chain issues."
Segars is optimistic that current and future investments would ease the supply chain in the short term, but he is also cautious about not creating huge expectations. "About $2 billion a week is going to be spent for the next couple of years to add capacity and build new facilities. And that's going to add about 50 percent additional capacity over the next five years...."
Segars predicted next year's Christmas might be much better for gift givers, but that consumers might still consider starting shopping early. And prices might not come down for a while. What is essential, Segars said, is to be patient, collaborate and invest. "Where are we going to be next Christmas? I expect these supply chain constraints to be a little better, but [they] won't be completely fixed because this isn't a short-term problem with a short-term solution. Billions of dollars are going to need to be spent in the coming years. And the decisions that we make today are going to affect the supply of this life, critical materials, semiconductors, over the next decade.
"Will we get this right? Will we spend enough? We spent too much, but we accidentally break the industries? That remains to be seen. That is the challenge that the industry is stepping up to" he added. "And in collaboration, across suppliers and customers and governments, we absolutely have to get it right!"
Segars also pointed out that it's hard to expand wafer production because there's so many different chemicals involved. "I mean virtually the whole periodic table that is used in making semiconductors. You need industrial style, very pure chemicals to feed into these factories downstream... So you need much more than just a chip factory to address these supply chain issues."
Chip crisis -- blame 2019, not 2020 (Score:5, Interesting)
According to https://www.statista.com/stati... [statista.com] the industry is producing and selling more chips than its previous peak in 2018. However, if you extrapolate the graph it seems that if they had kept the growth pace the same the years from 2000 to 2018 .. semiconductor manufacturers failed to build capacity they knew they would need this year. Probably because of the decline in 2019. Maybe? Or maybe it was deliberate, can they make more money in a shortage? Sort of like the OPEC oil deals of that ruined the late 70s?
Re: (Score:1)
All that bailout money has to go somewhere...
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A lot of it was simply scheduled downtime to rework lines for future production. Lines were taken offline to update them with more advanced processes, knowing full well that it would leave us with some minor, but necessary, shortfalls in the meantime. Unfortunately it landed right at the start of the pandemic, making things even worse. Which also lined up with other natural resource shortages that were in independent of the pandemic, making things worse again.
Oh ffs (Score:4, Insightful)
Re:Oh ffs (Score:5, Insightful)
Should companies trying to make cars today that use chips that they have been using for years, have actually purchased those chips years ago? The answer is yes.
My view on this is that there is a confluence between many fabs skipping this generation (even Intel) and the progression of GPU's onto the latest fabs.
5 years ago no gpu was made at a top of the line fab. Now all of them are. So there is higher demand than usual for top end fabrication, and lower demand for last generation fabs, so more than the normal amount of last gen fabs have been mothballed also. Whammy-Whammy-Whammy.
Re: Oh ffs (Score:2)
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Stockpile a depreciating asset in order to future proof your business.
You lose x% a year in opportunity cost for holding that cash as an asset instead of cash.
You gain y% for every year there is a global supply chain disruption and you continue to produce while your competition can't.
x may be small but the occurrence of y has been even smaller. Manufacturers will continue with JIT manufacturing, the US may insource chip production to US soil for, gulp, national security reasons. (Remember, this is slashdo
Call the Whambulance. (Score:3)
Re:Call the Whambulance. (Score:4, Informative)
They are delivering on contracts. However as demand is up, there's severe need to be able to set up more contracts for deliveries. For which there isn't capacity. Capacity that takes half a decade to set up if additional capacity becomes needed.
Hence the whining.
Re: (Score:2)
Do you understand that TFA is about an interview with ARM's CEO?
ARM is a fabless design company and doesn't manufacture or sell any chips.
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Do you understand that TFA is about an interview with ARM's CEO?
Who is speaking from the perspective (on behalf of?) the industry.
Re: Call the Whambulance. (Score:2)
They (chip makers) are delivering on any contracts. The demand is higher than they anticipated. The number of units chip manufacturers are producing is higher than ever. The problem is that demand is exceeding their production capacity because they had no idea so many people would suddenly want chips (or so they claim, it could also be an OPEC level conspiracy.)
Chip crisis - why not use old tech? (Score:2)
Related link on Slashdot (Score:2)
scolds "Chipmakers to Carmakers: Time To Get Out of the Semiconductor Stone Age."
The claim is the auto industry is in crisis because they were happy with the old tech, thank-you-very-much, which the chipmakers don't want to get up and running?
This is all the fault of the automakers because they don't want to retool their cars to use the new tech chips the chipmakers want to make?
My (limited) understanding is that instead of wires radiating from a centralized processor, a modern car has all of the thi
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And even the latest and greatest microcontrollers only use a 40nm process. Most use larger ones than that.
But seriously, just try looking for microcontrollers on Digi-Key and look at just how much is out of stock. If you want to use pretty much anything current-and-common, good luck actually buying it.
Re: Chip crisis - why not use old tech? (Score:2)
The production lines are all at max capacity producing more than ever before. More chips are being sold today than in 2019 or 2018. You have to build new buildings and all that. There are not enough workers and materials to get new production lines working in enough time.
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And I feel like I have to keep reminding people of this. All the big news articles act as if the only products affected are "cars" and "graphics cards." But there are a hell of a lot more cases of "$100 product missing $5 chip" being affected by this.