Daily Management Review

Gradually Easing Of Global Chip Shortage Expected By Taiwan's Acer


Gradually Easing Of Global Chip Shortage Expected By Taiwan's Acer
The current acute global shortage of semiconductor chips is showing signs of the beginning of easing for mid-end consumer products, according to a senior executive at Taiwan's Acer Inc, the fifth largest PC vendor of the world by shipments. The company said on Tuesday that the current situation of shortage of chips will get much better during the second half of the year.
The current global shortage of semiconductors was triggered by a sudden and sharp increase in demands for electronics products and home appliances during the Covid-19 pandemic as people were forced to stay back home and work, attend classes and get entertained at home. During this period, consumers stocked up on laptops, gaming consoles and other electronic products which resulted in tighter inventory.
During the Covid-19 pandemic, the auto companies in particular scaled down production because of slow demand and even shut down plants to save money as well as because of restrictions imposed to prevent the spread of the pandemic. However with a revival in demand for cars, auto companies are now competing against the consumer electronics industry to ensure constant supply of chip.
This unprecedented shortage in semiconductor microchips is hurting both businesses as well as customers across the globe because of stoppage and delays in deliveries of cars that use chips, a shortage in the supply of home appliances and other costlier smartphones.
At the beginning of the global chip shortage, the a global auto industry was the first to get hit as a bunch of major auto companies were forced to cut down on production. However the shortage has now also started to hit a range of other consumer electronics segments such as smartphones, refrigerators and microwaves whose functioning is significantly dependent on semiconductors.
The supply chain of the company has "jumped into action" with suppliers working towards addressing the situation ever since the problem first became apparent in the fourth quarter of last year, said Andrew Hou, Acer's president for Pan-Asia Pacific Operations, while talking to reporters in Taipei on Tuesday.  
The Taiwanese company now expects better supplies of chips in the second quarter of the current year compared with the first quarter of this year, Hou said, and added that the supply of chips will get much better during the second half of the current year compared to the second quarter of the current year.
"That's what we are seeing at the moment," he added.
The trend of a surge in demand for consumer electronics which started at the beginning of the pandemic is still continuing with companies and governments purchasing laptop computers to help people study and work from home which prompted Hou to say that the sales in his region, which excludes China, are booming.
"What is lacking is not the high end chips - it's the ones people have for a long time not cared about."