Electronics industry trends 2021

515 Comments

1. March 31, 2021 at 5:17 pm

   Tomi Engdahl says:

   When we talk about chips like Intel’s Core, we use terms like 14nm and 10nm to refer to what’s cutting-edge, and what’s not. Now Intel, which has struggled in manufacturing, is hinting that they want to move away from those terms.

   10nm? 7nm? Who cares? Intel may be trying to ditch chip technology definitions
   https://www.pcworld.com/article/3613590/why-intel-may-move-away-from-defining-its-chips-as-10nm-14nm-and-more.html

   What won’t change is how well chips perform in games and other applications, and how much power they consume.

   Chip vendors including AMD and Intel have for years defined a chip by a nanometer measurement such as 14nm or 10nm, which also described the manufacturing process of a chip. Such “nm” designations used to be nearly as important as clock speed, power, or any of the other various metrics of a chip. Intel, however, may be preparing to de-emphasize it entirely.

   What does “nanometer” mean in semiconductor manufacturing? “Nanometers” refer to the size of the individual transistors inside the chip. The smaller the transistor, the more dense the chip. Smaller transistors also imply that chips can be run at faster speeds, at lower power, or some combination of the two. Chipmakers use terms like “10nm” and 7nm” to describe the manufacturing process technology used to make these transistors, and this terminology has become widely adopted to indicate what’s leading-edge, and what isn’t.

   Over time, though, the terms have become somewhat muddy. Insiders already understand that the “definition” of a chip manufacturing process actually depends on many variables, including transistor density. Intel has said previously, for example, that its original 14nm process had a transistor density of 37.5 megatransistors (MTr) per square millimeter, and that this increased to 100.8 MTr per square millimeter with its 10nm process. Many consider Intel’s 10nm process technology to be on a par with TSMC’s own 7nm process, but the deeper details can already be confusing.

   Both Intel and AMD have also begun incorporating design elements that complicate the process technology even further. Intel’s “Superfin” technology, for example, is technically a “10nm” process, but the tweaks and improvements that it offers helps put Intel at nearly an equal footing to AMD’s 7nm Ryzen 5000 in our review. Intel’s Foveros and AMD’s related chiplet technology place entirely different silicon inside the same package, which is reviewed as a single, monolithic product.

   Longtime chip nerds may also recall a period in the late 1990s, when AMD, Cyrix, SGS-Thomson and others developed the concept of “performance ratings”—arguing that while their chips actually ran at slower clock speeds, they were just as fast as the 386 and 486 chips Intel marketed at the time. It’s somewhat ironic to see Intel hinting that it may adopt the same strategy.

   Reply
2. March 31, 2021 at 5:23 pm

   Tomi Engdahl says:

   Taiwan’s outsized role in chipmaking has come under the spotlight as a global shortage of semiconductors forced several automakers to halt production.

   2 charts show how much the world depends on Taiwan for semiconductors
   https://www.cnbc.com/2021/03/16/2-charts-show-how-much-the-world-depends-on-taiwan-for-semiconductors.html?utm_term=Autofeed&utm_medium=Social&utm_content=Tech&utm_source=Facebook#Echobox=1616701490

   The global shortage of chips that forced several automakers to halt production has brought attention to Taiwan’s outsized role in semiconductor manufacturing.
   Taiwan dominates the foundry market, or the outsourcing of semiconductor manufacturing.
   Much of that dominance comes down to TSMC, the world’s largest foundry that counts major technology firms such as Apple, Qualcomm and Nvidia as its clients.

   Countries including the U.S. and Germany reached out to Taiwan to help alleviate bottlenecks in the production of chips. The shortage was a result of increased demand for electronics during the Covid-19 pandemic, and was exacerbated by former President Donald Trump’s trade war with China.

   Taiwan dominates the foundry market, or the outsourcing of semiconductor manufacturing. Its contract manufacturers together accounted for more than 60% of total global foundry revenue last year, according to data by Taipei-based research firm TrendForce.

   Much of Taiwan’s dominance can be attributed to Taiwan Semiconductor Manufacturing Co or TSMC, the world’s largest foundry

   TSMC accounted for 54% of total foundry revenue globally last year, TrendForce data showed.

   TSMC focuses solely on manufacturing and has been the go-to producer for many cutting-edge semiconductors

   “So TSMC, if you just have a look at market share, I believe manufactures around 50% of all semiconductors in the world. And I think that still understates how important it is, because these are some of the most advanced chips out there,” said Wang.

   Semiconductor designers and manufacturers are on a quest to make chips smaller and better. Currently, TSMC and its South Korean rival Samsung are the only foundries capable of manufacturing the most advanced 5-nanometer chips.

   TSMC is already gearing up for the next-generation 3-nanometer chips, that will reportedly start production in 2022.

   China playing catch up
   Some countries are planning to boost their own semiconductor production — and one of them is China

   TSMC is just so dominant. It no longer really has much competition at all on the high end.
   Dan Wang
   TECHNOLOGY ANALYST, GAVEKAL DRAGONOMICS

   Reply
3. April 1, 2021 at 7:50 am

   Tomi Engdahl says:

   Debby Wu / Bloomberg:
   TSMC says it plans to spend $100B over the next three years to expand its chip fabrication capacity

   TSMC to Spend $100 Billion Over Three Years to Grow Capacity
   https://www.bloomberg.com/news/articles/2021-04-01/tsmc-to-invest-100-billion-over-three-years-to-grow-capacity

   Taiwan Semiconductor Manufacturing Co. plans to spend $100 billion over the next three years to expand its chip fabrication capacity, a staggering financial commitment to address booming demand for new technologies.

   TSMC, the world’s leading manufacturer of advanced semiconductors, already planned a record capital expenditure of as much as $28 billion this year, but recent trends and developments have pushed for even more capacity. Now at the center of a global chip supply crunch, Taiwan’s biggest company has pledged to work with customers across industries to overcome a deluge of demand.

   “TSMC expects to invest USD$100b over the next three years to increase capacity to support the manufacturing and R&D of advanced semiconductor technologies,” the company said in a statement responding to local media reports. “TSMC is working closely with our customers to address their needs in a sustainable manner.”

   Reply
4. April 1, 2021 at 7:51 am

   Tomi Engdahl says:

   https://www.bloomberg.com/graphics/2021-semiconductors-chips-shortage/

   Reply
5. April 1, 2021 at 12:06 pm

   Tomi Engdahl says:

   Emily Feng / NPR:
   How Wuhan’s HSMC created an unusable chip factory, becoming one of six multibillion-dollar Chinese chip project failures in the last two years

   A Cautionary Tale For China’s Ambitious Chipmakers
   https://www.npr.org/2021/03/25/980305760/a-cautionary-tale-for-chinas-ambitious-chipmakers?t=1617277572023

   WUHAN, China — In 2019, the U.S. sanctioned two major Chinese telecom firms, temporarily cutting them off from a vital supply of semiconductor chips — bits of silicon wafer and microscopic circuitry that help run nearly all our electronic devices.

   Wuhan Hongxin Semiconductor Manufacturing Co. promised a way out, toward self-reliance in the face of increasingly tough U.S. curbs on this technology. The private company once boasted on its website that it would raise a total of $20 billion to churn out 60,000 leading-edge chips a year.

   None of that would come to pass.

   Hongxin’s unfinished plant in the port city of Wuhan now stands abandoned. Its founders have vanished, despite owing contractors and investors billions of yuan.

   The company is one of six multibillion-dollar chip projects to fail in the last two years. Their rise and fall is a cautionary tale in an industry that is flush with state cash but still scarce on expertise — and a preview of the expensive and winding road China will have to take toward semiconductor self-sufficiency, now a national security priority.

   To balance out their lack of technical know-how, the Hongxin founders lured in one of Taiwan’s most famous semiconductor engineers, Chiang Shangyi, to serve as director. He left the company in 2020 to become the deputy chairman of China’s Semiconductor Manufacturing International Corp., telling Hong Kong paper South China Morning Post that his time at Hongxin was “a nightmare.”

   Hongxin made headlines in December 2019 when it managed to buy an older model lithography machine made by Dutch company ASML, despite American lobbying to prevent its sale to the Chinese chipmakers.

   ASML sold the multimillion dollar piece of equipment — used to etch semiconductors — because of Jiang’s top-notch reputation

   Chinese chip companies still rely heavily on European, American and Japanese technology — much of which, in turn, relies on American intellectual property, which the U.S. appears determined to keep out of Chinese hands. China’s semiconductor demand continues to surge beyond what it can supply itself; trade data show that in 2019, Beijing imported around $350 billion worth in chips.

   Given that reliance, China’s central and local governments have been pumping money into the sector to accelerate domestic chip design and manufacturing.

   The all-out approach has notched achievements. Successful chip design companies such as Cambricon and Huawei’s HiSilicon have allowed Huawei to replace some of its U.S.-designed chips in its mobile phones. Not far from Hongxin is Yangtze Memory Technologies Co. (YMTC), a partially state-owned company that plans to double its output of memory chips to overtake South Korea’s Samsung and SK Hynix, which currently dominate production.

   Broken promises

   As early as late 2019, even while Hongxin was being lauded by Chinese media for securing an ASML machine, several Wuhan-based construction crews were scrambling to get paid for millions of dollars of work for Hongxin.

   Meanwhile, two other semiconductor companies — Tacoma Semiconductor Technology Co. Ltd. and Dehuai Semiconductor Technology Co. Ltd — were also running out of cash.

   Hongxin, Tacoma and Dehuai were able to secure billions of yuan in state funding on the condition they would match that with investment of their own — a commitment that never materialized. Tacoma eventually raised only a fraction — 250 million out of 2.5 billion yuan — of what it promised.

   “We never imagined that when our cash flow dried up, we would not be able to find new [cash flow sources], that we would get in so deep,” he told Japanese broadcaster NHK this March.

   Technology analysts say China’s most recent semiconductor flops illustrate how astronomical upfront costs in the industry are, even for local governments.

   “What leading companies like South Korea’s Samsung and Taiwan’s chipmaker TSMC are spending in terms of R&D every year rivals some of the big government funds in China, so even if you use the lever of industrial policy and huge state subsidies, it’s just really hard to compete with the established leaders,”

   The dissolution of Hongxin, Tacoma and Dehuai has led to a cascading chain of bankruptcies in their wake.

   “The executives are nowhere to be found,”

   Tacoma and Dehuai have officially declared bankruptcy, and local government bodies have taken over the companies’ remaining assets for restructuring.

   Given the sheer number of semiconductor companies receiving state investment, some were bound to fail — expensive, but necessary mistakes in China’s ambitions toward technological independence, says Zhang Honglei, a director at RunJet, a Wuhan-headquartered company that makes chip components.

   “The semiconductor industry is characterized by its requirement of high investment, high risk — and of course, the possibility of high return. During the development process, firms like ours need constant financial inputs and support,” Zhang says.

   Three other major businesses went bankrupt last year. Even established chip companies are seeing cash flow troubles; YMTC’s parent company Tsinghua Unigroup said last December it had defaulted on paying the principal back on nearly $2.5 billion worth in bonds due to a “liquidity issue.”

   The high risk has not discouraged a wave of new entrants. More than 20,000 new semiconductor-related companies sprang into existence last year alone, according to Qichacha, a Chinese corporate records database.

   Chinese policymakers are trying to slow a boom in semiconductor companies, warning against excessive investment and white elephant projects.

   “This risks leading to the construction of low-level or duplicate chip manufacturing plants,”

   Reply
6. April 2, 2021 at 6:26 pm

   Tomi Engdahl says:

   Last week, IBM and Intel formed an unlikely partnership to take on international competition in the chipmaking business. From sub-7nm processes to tech-sharing arrangements, the duo are exploring new inroads to collaboration.

   IBM Exec on Intel Chipmaking Collab: “Choose Your Strength”
   https://spectrum.ieee.org/tech-talk/semiconductors/devices/us-semiconductor-titans-join-forces-to-battle-international-competitors

   Intel and IBM—two of the titans of the U.S. semiconductor industry over the last 40 years—have joined forces to advance next-generation logic and packaging technologies. This new partnership comes as a bit of a surprise to anyone who has observed the U.S. semiconductor industry over the last four decades and witnessed the rivalry between the two companies.

   The backdrop for these two long-term competitors joining forces may help explain the timing for this unusual partnership. Last week, Intel announced a strategy it’s calling IDM 2.0. (IDM, stands for integrated device manufacturer, as opposed to say TSMC, which is a pure-play foundry.) A major part of that scheme is to double down on manufacturing, pumping $20-billion into new fabs, and jump start its foundry services, manufacturing chips for other companies.

   Reply
7. April 2, 2021 at 8:34 pm

   Tomi Engdahl says:

   Debby Wu / Bloomberg:
   TSMC says it plans to spend $100B over the next three years to expand its chip fabrication capacity
   TSMC to Spend $100 Billion Over Three Years to Grow Capacity
   https://www.bloomberg.com/news/articles/2021-04-01/tsmc-to-invest-100-billion-over-three-years-to-grow-capacity

   TSMC, the world’s leading manufacturer of advanced semiconductors, already planned a record capital expenditure of as much as $28 billion this year, but recent trends and developments have pushed for even more capacity. Now at the center of a global chip supply crunch, Taiwan’s biggest company has pledged to work with customers across industries to overcome a deluge of demand.

   Reply
8. April 3, 2021 at 7:30 pm

   Tomi Engdahl says:

   AMD isn’t the only company using TSMC 7nm for GPUs.

   China’s First 7nm GPU Nears Mass Production, Pics Emerge
   https://www.tomshardware.com/news/china-first-7nm-gpu-heads-to-production?utm_source=facebook.com&utm_medium=social&utm_campaign=socialflow&utm_content=tomsguide

   Shanghai Tianshu Intellectual Semiconductor Co. (Tianshu Zhixin) announced Wednesday that it’s nearing “mass production and commercial delivery” of Big Island, China’s first domestically produced 7nm general-purpose GPU (GPGPU).

   Tianshu Zhixin said in January that BI was made using an unidentified 7nm process node and 2.5D chip-on-wafer-on-substrate (CoWoS) packaging. On Wednesday, it confirmed our suspicion that BI was made using TSMC’s 7nm FinFET process.

   It also shared a little more information about what people can expect from BI when it starts to ship.

   Tianshu Zhixin claimed that BI offers “nearly twice the performance of mainstream manufacturers’ products” at a lower power consumption while also offering a more attractive price-to-performance ratio. (Pricing details weren’t revealed, however.)

   Reply
9. April 4, 2021 at 6:05 am

   Tomi Engdahl says:

   Semiconductors supply woes deepen, global cooperation urgently needed to expand production
   https://www.globaltimes.cn/page/202104/1220132.shtml#.YGlELgrubdA.facebook

   Showing no sign of slackening, the global chip supply shortfall is pushing up the prices of chip wafers and semiconductor products by a steep 20 percent, media reports said.

   And, industry analysts warned the chip supply woes won’t ease until the end of 2020 or even 2021.

   SMIC said its chip products now on assembly lines will keep their original prices, but future semiconductor products will be sold at a higher price, financial media 21jingji.com reported, adding the rise ranged between 15 to 30 percent.

   Such a price hike has pushed up the stock prices of semiconductor-related companies on a whole.

   The rising demand for electronics amid the coronavirus pandemic, coupled with less optimistic expectations of economic recovery by the world’s automakers, have caused the current global chip shortages

   And, the US government’s relentless trade restrictions imposed on SMIC and other Chinese high-tech companies also contributed to the shortfall in chips on the market

   “The ban of the US government has restricted China’s semiconductor production expansion and resulted in insufficient chip supply globally, seriously disturbing growth of the semiconductor industry,” Zhang said.

   Currently, at least nine automakers have been forced to suspend production, including Hyundai, Honda, Volvo, Ford, Nissan, Nio and other plants.

   The chip crisis has now even spread to telecom equipment and consumer electronics. Apple, Samsung, Sony and Foxconn all issued warnings on a delay of chip shipments or shipment reductions

   On Thursday, the world’s largest contract chipmaker Taiwan Semiconductor Manufacturing Company (TSMC) said it plans to invest $100 billion over the next three years to increase capacity. The move came after Intel Corp’s announcement to spend $20 billion on the expansion of advanced chip-making capacity.

   Reply
10. April 4, 2021 at 6:11 am

    Tomi Engdahl says:

    Absolutely fab: As TSMC invests $100bn to address chip shortage, where does that leave the rest of the industry?
    Semiconductor sovereignty, meet supply chain security
    https://www.theregister.com/2021/04/02/tsmc_fab_investment/

    “The shortage is a reminder of the essential role semiconductors play in so many critical areas of society, including transportation,” said Yinug in a blog post. “This trend will only continue as demand for electronics and connectivity grows.”

    The drought in Taiwan, where TSMC is based, hasn’t helped.

    Yinug argued that the shortage should be addressed by more federal support for chip manufacturing in the US and attributed the declining US share of the global semiconductor market – from 37 percent in 1990 to 12 percent today – to foreign government subsidies of foreign competitors that have gone unanswered.

    A week later, the US-focused trade group sent a letter [PDF], signed by the CEOs of AMD, Intel, and other US chip makers, to US President Joe Biden asking for “substantial funding for incentives for semiconductor manufacturing.”

    Biden on Wednesday rewarded the industry by asking Congress, as part of his American Rescue Plan, “to invest $50 billion in semiconductor manufacturing and research, as called for in the bipartisan CHIPS Act.”

    US chipmakers have already made comparable commitments, with Intel last month promising $20bn to build two new fabs in Arizona as a part of its planned foundry business.

    But Intel will have competition there. Last year, in May, TSMC also tapped Arizona as the location of a planned $12bn semiconductor fab it plans to build. And Samsung Foundry as of January was casting about for government subsidies to build a new fab site in Arizona, New York, or Texas

    The EU in March, as part of its Digital Compass plan, said it wants to double its chip output to 20 per cent of the global market by 2030. The following day, Apple, a TSMC customer, said it would invest over €1bn in a European chip design center based in Munich, Germany.

    In November, trade group SEMI projected that the semiconductor industry will add 38 new 300mm fabs by 2024, and more recently forecast a surge in fab equipment spending.

    According to a Congressional Research Service report published October 26, 2020, “Semiconductors: US Industry, Global Competition, and Federal Policy” [PDF], Taiwan, South Korea, and Japan accounted for two-thirds of the world’s semiconductor fabrication capacity in 2019, and China was responsible for 12 per cent of global fabrication.

    The report notes that US legislators have become increasingly concerned about the concentration of chip manufacturing in East Asia and the implications that has on the semiconductor supply chains in the event of trade conflict or warfare.

    Reply
11. April 4, 2021 at 6:11 am

    Tomi Engdahl says:

    https://en.m.wikipedia.org/wiki/ASML_Holding

    Reply
12. April 5, 2021 at 9:13 am

    Tomi Engdahl says:

    Intel is reportedly considering a change to how it reports its process node sizes. It may be a good idea.

    Intel May Change Its Process Node Numbering to Align With TSMC, Samsung
    https://www.extremetech.com/computing/321426-intel-may-change-its-process-node-numbering-to-align-with-tsmc-samsung?utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=facebook

    Intel is reportedly considering changing its process node numbering system in a bid to look better against Samsung and TSMC. As solutions to Intel’s problems go, renumbering its process nodes isn’t going to close technical gaps between itself and TSMC. If Intel is serious about entering the client foundry business, however, it may need to patch up its marketing

    Ann Kelleher, the Hillsboro VP in charge of Intel’s manufacturing group, has notified employees that “Intel plans to change its numbering conventions to match the industry standard,” according to Oregon Live. The phrase “industry standard” is doing a lot of heavy lifting here because there is no ‘industry standard.’

    TSMC’s 7nm technology is different than Intel’s still-unlaunched 7nm, which is different from Samsung’s 7nm.

    The chart above shows a comparison between 10nm technologies for Intel, TSMC, and Samsung. Intel’s contacted gate pitch and minimum metal pitch are both much lower than what TSMC and Samsung defined for their own 10nm or even 7nm, in a few specific metrics. When Intel claims that its 10nm technology looks more like TSMC and Samsung’s 7nm technology, it’s telling the truth. If Intel changes its node naming to more closely reflect what TSMC and Samsung are doing, it will arguably improve a customer’s ability to understand comparisons between the different foundries

    Reply
13. April 5, 2021 at 11:02 am

    Tomi Engdahl says:

    This push for a more balanced global supply chain is part of Intel’s expansion into the client foundry business and the company clearly hopes to capitalize on the perception supply chain issues are the result of too much capacity in the Asia-Pacific region.

    Intel CEO: Reliance on Asia for Semiconductor Manufacturing Isn’t ‘Palatable’
    https://www.extremetech.com/computing/321224-intel-ceo-reliance-on-asia-for-semiconductor-manufacturing-isnt-palatable?utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=facebook

    “Having 80 percent of all supply in Asia simply isn’t a palatable manner for the world to have its view of the most critical technology,” Gelsinger told the BBC. ” Every smartphone, every telemedicine, every remote worker, every remote education, every autonomous vehicle, every aspect of humanity is becoming more digital. This is the heart of every aspect of human existence going forward. And the world needs a more balanced supply chain to accomplish that. We’re stepping in.”

    Gelsinger also noted that Intel intends to open at least one new facility in a new European country as part of its buildout efforts over the next 3-5 years.

    Intel Is Spinning the Semiconductor Shortage
    According to Gelsinger, Intel’s recent decision to enter the client foundry business in earnest was driven by its desire to help the world. Seriously.

    When asked why Intel would make chips for other companies and thereby “help the competition,” Gelsinger reiterated that manufacturing is a capacity game and that foundries that can’t manufacture enough chips can’t exploit a large enough economy of scale to sustain the cost of chip manufacturing. There’s real truth to that. One reason Intel conquered the server and workstation markets of the 1990s was by taking advantage of its superior economy of scale.

    Companies that ought to know better are pretending that just building more foundries is a magical way to avoid this problem in the future. We’re stuck in the middle of a semiconductor shortage this year because the pandemic disrupted buying patterns and sent demand for semiconductors skyrocketing. It takes months, even years, to bring new semiconductor manufacturing capacity online. AMD, Nvidia, Qualcomm, MediaTek, Broadcom, and other chip designers aren’t captives, exactly, but moving a chip design from one foundry to another is a 6-12 month affair.

    The idea that building more capacity now will prevent or even mitigate a future calamity relies on four false assumptions.

    Everything in semiconductor manufacturing is slow. Teams at Intel, Nvidia, and AMD are working on products right now we won’t see in-market until 2023 or 2024. The new capacity expansions announced by TSMC, Samsung, and Intel won’t come online until several years from now, and they’ll be scheduled as close to capacity as possible once they do.

    This shortage, and the ongoing US-China trade war, have kicked off a flurry of silicon nationalism. Suddenly, the EU wants 20 percent of silicon manufacturing by 2030. Samsung and TSMC have announced they’ll build facilities in the United States. Intel is building $20B worth of fabs in Oregon and looking to expand internationally. There are plenty of good reasons why the United States should consider silicon manufacturing a strategic capability, but the idea that we’re suffering now because 80 percent of silicon manufacturing is in Asia, specifically, is false. The silicon manufacturing industry is hyper-optimized.

    Intel’s plan to simultaneously revitalize its own manufacturing while opening the doors of a client foundry is a radical departure from anything the company has done before.

    Intel definitely wants to expand its own manufacturing base and catch up to its competitors, but it’s not pursuing those goals in a way that would prevent the semiconductor shortage of 2021 from happening again under similarly disruptive circumstances.

    Reply
14. April 6, 2021 at 9:42 am

    Tomi Engdahl says:

    Currently, all of GlobalFoundries’ manufacturing capacity is booked — and it expects semiconductor supply to lag behind demand until 2022 or later.

    CEO of largest U.S. chip foundry explains why semiconductor shortage could last through 2022
    https://www.cnbc.com/2021/04/02/globalfoundries-ceo-on-semiconductor-shortage-and-ipo.html?utm_term=Autofeed&utm_medium=Social&utm_content=Tech&utm_source=Facebook#Echobox=1617393569

    KEY POINTS
    A shortage of semiconductor microchips is causing havoc around the world.
    GlobalFoundries, the third-largest foundry, is planning to invest $1.4 billion in its foundries this year to address the shortage.
    GlobalFoundries is considering an IPO in the first half of 2022 or sooner, CEO Tom Caulfield told CNBC.

    Caufield said the company’s manufacturing capacity is completely booked and that industrywide semiconductor supply could lag behind demand until 2022 or later.

    “Right now all our fabs are not only more than 100% utilized, we are adding capacity as fast as we can,” Caulfield said.

    A shortage of semiconductor microchips is causing havoc around the world, delaying car production and affecting the operations of some of the largest consumer electronics manufacturers.

    The shortage has highlighted the role of a handful of foundries, which are the factories contracted by semiconductor firms to build chips.

    GlobalFoundries is the largest U.S.-headquartered “pure” foundry, with factories in the U.S., Germany and Singapore. It manufactures semiconductors designed by companies like AMD, Qualcomm and Broadcom. It’s currently a private company owned by the government of Abu Dhabi.

    Reply
15. April 6, 2021 at 11:17 am

    Tomi Engdahl says:

    Why Shortages of a $1 Chip Sparked Crisis in Global Economy
    https://www.bloomberg.com/news/articles/2021-04-05/why-shortages-of-a-1-chip-sparked-crisis-in-the-global-economy?utm_content=business&utm_medium=social&utm_source=facebook&cmpid=socialflow-facebook-business&utm_campaign=socialflow-organic

    Reply
16. April 6, 2021 at 11:18 am

    Tomi Engdahl says:

    Chip crisis actually occurred due to a world wide pandemic lockdown combined with USA-China trade war champions.
    Added spices to the soup were electrical power problems in Texas that shut down several chip factories and Renesas chip factory in Japan, which affected especially availability of chips used by car industry.

    Reply
17. April 7, 2021 at 9:00 am

    Tomi Engdahl says:

    Bloomberg:
    Companies that make $1 display driver chips can’t keep up with surging demand, causing serious production problems for products with LCD displays like laptops

    Why Shortages of a $1 Chip Sparked Crisis in Global Economy
    https://www.bloomberg.com/news/articles/2021-04-05/why-shortages-of-a-1-chip-sparked-crisis-in-the-global-economy

    To understand why the $450 billion semiconductor industry has lurched into crisis, a helpful place to start is a one-dollar part called a display driver.

    Hundreds of different kinds of chips make up the global silicon industry, with the flashiest ones from Qualcomm Inc. and Intel Corp. going for $100 apiece to more than $1,000. Those run powerful computers or the shiny smartphone in your pocket. A display driver chip is mundane by contrast: Its sole purpose is to convey basic instructions for illuminating the screen on your phone, monitor or navigation system.

    The trouble for the chip industry — and increasingly companies beyond tech, like automakers — is that there aren’t enough display drivers to go around. Firms that make them can’t keep up with surging demand so prices are spiking. That’s contributing to short supplies and increasing costs for liquid crystal display panels, essential components for making televisions and laptops, as well as cars, airplanes and high-end refrigerators.

    “It’s not like you can just make do. If you have everything else, but you don’t have a display driver, then you can’t build your product,” says Stacy Rasgon, who covers the semiconductor industry for Sanford C. Bernstein.

    Now the crunch in a handful of such seemingly insignificant parts — power management chips are also in short supply, for example — is cascading through the global economy. Automakers like Ford Motor Co., Nissan Motor Co. and Volkswagen AG have already scaled back production, leading to estimates for more than $60 billion in lost revenue for the industry this year.

    The situation is likely to get worse before it gets better.

    The chip crunch was born out of an understandable miscalculation as the coronavirus pandemic hit last year. When Covid-19 began spreading from China to the rest of the world, many companies anticipated people would cut back as times got tough.

    “I slashed all my projections. I was using the financial crisis as the model,” says Rasgon. “But demand was just really resilient.”

    People stuck at home started buying technology — and then kept buying. They purchased better computers and bigger displays so they could work remotely. They got their kids new laptops for distance learning. They scooped up 4K televisions, game consoles, milk frothers, air fryers and immersion blenders to make life under quarantine more palatable. The pandemic turned into an extended Black Friday onlinepalooza.

    Automakers were blindsided. They shut factories during the lockdown while demand crashed because no one could get to showrooms. They told suppliers to stop shipping components, including the chips that are increasingly essential for cars.

    Then late last year, demand began to pick up. People wanted to get out and they didn’t want to use public transportation. Automakers reopened factories and went hat in hand to chipmakers like TSMC and Samsung. Their response? Back of the line. They couldn’t make chips fast enough for their still-loyal customers.

    A Year of Poor Planning Led to Carmakers’ Massive Chip Shortage

    Wu explained that he can’t make more display drivers by pushing his workforce harder. Himax designs display drivers and then has them manufactured at a foundry like TSMC or United Microelectronics Corp. His chips are made on what’s artfully called “mature node” technology, equipment at least a couple generations behind the cutting-edge processes. These machines etch lines in silicon at a width of 16 nanometers or more, compared with 5 nanometers for high-end chips.​

    ​The bottleneck is that these mature chip-making lines are running flat out. Wu says the pandemic drove such strong demand that manufacturing partners can’t make enough display drivers for all the panels that go into computers, televisions and game consoles — plus all the new products that companies are putting screens into, like refrigerators, smart thermometers and car-entertainment systems.

    There’s been a particular squeeze in driver ICs for automotive systems because they’re usually made on 8-inch silicon wafers, rather than more advanced 12-inch wafers. Sumco Corp., one of the leading wafer manufacturers, reported production capacity for 8-inch equipment lines was about 5,000 wafers a month in 2020 — less than it was in 2017.

    No one is building more mature-node manufacturing lines because it doesn’t make economic sense. The existing lines are fully depreciated and fine-tuned for almost perfect yields, meaning basic display drivers can be made for less than a dollar and more advanced versions for not much more. Buying new equipment and starting off at lower yields would mean much higher expenses.

    “Building new capacity is too expensive,” Wu says.

    That shortfall is showing up in a spike in LCD prices. A 50-inch LCD panel for televisions doubled in price between January 2020 and this March. Bloomberg Intelligence’s Matthew Kanterman projects that LCD prices will keep rising at least until the third quarter. There is a “a dire shortage” of display driver chips, he said.

    Aggravating the situation is a lack of glass. Major glass makers reported accidents at their production sites

    Wu isn’t celebrating. His whole business is built around giving customers what they want, so his inability to meet their requests at such a critical time is frustrating. He doesn’t expect the crunch, especially for automotive components, to end any time soon.

    “We have not reached a position where we can see the light at the end of tunnel yet,” Wu said.

    Reply
18. April 7, 2021 at 9:03 am

    Tomi Engdahl says:

    Debby Wu / Bloomberg:
    Foxconn Q1 revenue jumps 44% YoY to $47B based on robust demand for Apple’s new 5G devices and other gadgets

    Hon Hai Revenue Jumps 44% on Stay-at-Home Demand for Gadgets
    https://www.bloomberg.com/news/articles/2021-04-06/hon-hai-revenue-jumps-44-on-stay-at-home-demand-for-gadgets

    Reply
19. April 7, 2021 at 9:06 am

    Tomi Engdahl says:

    https://www.eetimes.com/good-vibrations-for-piezo-mems-market/

    Reply
20. April 8, 2021 at 10:24 am

    Tomi Engdahl says:

    https://www.uusiteknologia.fi/2021/04/08/puolijohdepiirien-myynti-rajussa-kasvussa/

    Reply
21. April 8, 2021 at 1:55 pm

    Tomi Engdahl says:

    #TBT: From the 3-nanometer node on, it’s all about nanosheets.

    The Nanosheet Transistor Is the Next (and Maybe Last) Step in Moore’s Law
    https://spectrum.ieee.org/semiconductors/devices/the-nanosheet-transistor-is-the-next-and-maybe-last-step-in-moores-law

    Reply
22. April 12, 2021 at 7:22 am

    Tomi Engdahl says:

    Bloomberg:
    Sources: ISPs in the US are seeing delays as long as 60 weeks, more than double previous waits, when ordering internet routers, due to the global chip shortage

    Sixty-Week Delay on Router Orders Shows Scale of Chip Crisis
    https://www.bloomberg.com/news/articles/2021-04-08/next-victim-of-chip-shortage-will-be-your-home-internet-router

    Router-makers including Zyxel report much longer lead times
    Chip shortage effects cascade into multiple product markets

    Broadband providers are seeing delays of more than a year when ordering internet routers, becoming yet another victim of chip shortages choking global supply chains and adding challenges for millions still working from home.

    Carriers have been quoted order times as long as 60 weeks, more than doubling previous waits, according to people familiar with the matter, who asked not to be named because the discussions are private.

    Running out of the right router would prevent a carrier from being able to add new subscribers to its network, risking lost sales in the ever-competitive broadband market. Their supply chains have become a headache because sharp coronavirus manufacturing shutdowns a year ago were exacerbated by a prolonged surge in demand for better home broadband equipment, said Karsten Gewecke, head of European regional business for Zyxel Communications Corp, a Taiwan-based router-maker.

    Since January, it’s asked customers to order products a year in advance, he said, because the lead time for components like chips from Broadcom Inc. doubled to a year or more since then. Zyxel is a major supplier of routers, with customers including Norway’s Telenor ASA and Britain’s Zen Internet.

    Adtran, a U.S. network equipment maker picking up market share from China’s Huawei Technologies Co. in Europe, has also warned customers of supply chain risks and lead-time extensions in recent months.

    No carrier has run out of routers completely yet, but the supply chain looks strained for the next six months, so it’s possible, according to Gewecke. “We have been very close several times,” he said in a video call. “It could still happen.”

    Even shipments already en route can’t escape global trade ructions: last week, Zyxel routers were on and behind the Evergreen ship which blocked the Suez Canal, according to Gewecke.

    Reply
23. April 12, 2021 at 8:45 am

    Tomi Engdahl says:

    Get Ready for the Most Interesting CPU Market We’ve Seen in Decades
    https://www.extremetech.com/computing/315354-get-ready-for-the-most-interesting-cpu-market-weve-seen-in-30-years?utm_campaign=trueAnthem%3A+Manual&utm_medium=trueAnthem&utm_source=facebook

    For most of the last 2.5 decades, the PC CPU industry has been dominated by a single architecture: x86. While the 1990s opened with a number of architectures technically still competing with Intel, by the end of the decade, AMD stood alone against the chip titan. IBM threw in the towel on G5 by the mid-2000s. Intel, it seemed, had won.

    But the passage of time has a funny way of reshaping our perceptions of an era. Intel’s near-total victory by the mid-2000s now looks more like a temporary pause than a permanent win — and the CPU market is heating up now in ways we haven’t seen in decades. SiFive is claiming it can build a RISC-V desktop chip in the future. Startups like Nuvia have been acquired by Qualcomm, which plans to launch its own custom silicon by late 2022 – early 2023. Both AMD and Intel have recently debuted new architectures — AMD has extended Zen 3 into servers and mobile, while Intel has launched both Rocket Lake and Ice Lake Server.

    Then there’s Apple and the M1. While the CPU is not a total knockout blow against AMD and Intel, it sets a new bar in performance and power efficiency that both x86 companies are going to have to match in the long term. Apple isn’t going to take over the mass PC market or start building Windows machines, but Qualcomm has already announced that it intends to bring laptops to market based on Nuvia’s new CPU design. Intel and AMD have a little breathing room to bring new hardware to market, but the long-delayed battle between x86 and ARM is coming. It won’t be long before we’re able to make much better comparisons between the two CPU families.

    If Intel continues to struggle with 7nm, or if its opponents prove to have stronger designs than anticipated, it’ll fall to Advanced Micro Devices to keep x86 competitive against designs from firms like Ampere, Apple, and Qualcomm. This would be an unprecedented situation. AMD has beaten Intel and taken the overall lead in the x86 market before, but it’s never been the primary defender of that market against a rival architecture, mostly because x86 hasn’t had any plausible rival architectures for so many years.

    But — and this is the funny thing — AMD needs Intel, too. If Intel stopped selling CPUs tomorrow, TSMC factually lacks the wafer capacity to cover the gap

    Every server that goes out the door with an Intel logo on it is a server AMD can still make a play for. Once customers start switching to ARM, convincing them to switch back could be a more difficult proposition.

    If Intel can’t field competitive designs quickly enough, it’ll need AMD’s execution to demonstrate that x86 has what it takes to challenge ARM.

    It’s been decades since the CPU market was this dynamic. If you’re interested in underdogs and up-and-comers, RISC-V is making waves. Apple’s M1 made a huge impression at launch last year and it’s got a bigger brother arriving in the not-so-distant future. Intel’s new 3rd Generation Xeon Scalable CPUs are a meaningful step back towards competitive standing for Chipzilla and AMD’s Zen 3 architecture has moved the ball forward in desktop, mobile, and server. It’s never been a more interesting time to cover CPUs.

    Reply
24. April 12, 2021 at 8:47 am

    Tomi Engdahl says:

    For the consumer, Intel didn’t do much.

    Meanwhile the business software requirements would increase two folds every new version, resulting in the premium-I like performance even on the latest technology.

    Reply
25. April 13, 2021 at 4:50 am

    Tomi Engdahl says:

    Intel CEO calls for “moonshot” to boost U.S. role in chipmaking
    https://www.axios.com/intel-ceo-gelsinger-chipmaking-moonshot-boost-us-6d30b6eb-824d-4cbd-90c8-42150386d545.html

    Intel CEO Pat Gelsinger called Monday for the U.S. to spend billions of dollars over the next few years as part of a “moonshot” designed to regain lost ground in semiconductor manufacturing. The goal, he said, is to see the U.S. again account for a third of global output, up from about 12% today.

    Why it matters: Investments made now will take several years to bear fruit, so they won’t do much to ease the current semiconductor shortage, but they’re vital to America’s long-term economic future and national security, Gelsinger told Axios on Monday.

    Between the lines: Congress voiced support for investing $50 billion in chipmaking efforts as part of a recent defense spending authorization bill, but it did not actually commit the funds.

    Yes, but: Although most of what’s under discussion will take years to have an impact, Gelsinger does believe that Intel can offer some help with the current chip shortage.

    Per Reuters, Gelsinger believes Intel’s current manufacturing plants could provide some help to carmakers over the next six to nine months if automotive chip designers shifted some production to Intel’s plants.

    The big picture: Gelsinger, as well as executives from Google and elsewhere, left Monday’s White House meeting encouraged by the broad support across parties and branches of government for investment in U.S. semiconductor manufacturing.

    “We commend President Biden’s support for $50 billion in semiconductor manufacturing and research investments,” Semiconductor Industry Association CEO John Neuffer said in a statement. “Funding the chip manufacturing incentives and research investments called for in the CHIPS for America Act, as President Biden’s infrastructure plan would do, will strengthen U.S. semiconductor production and innovation across the board so all sectors of our economy have the chips they need.”

    Reply
26. April 13, 2021 at 5:53 am

    Tomi Engdahl says:

    China’s Huawei Blames US For Global Chip Shortage
    https://www.zerohedge.com/economics/chinas-huawei-blames-us-global-chip-shortage

    Just around the time Joe Biden was concluding a meeting with more than a dozen CEOs on Monday addressing the global chip shortage that has snarled supply chains and brought high-tech industries to a stop (a meeting in which he offered $50 billion for semiconductor manufacturing and research), China’s Huawei Technologies – which has been stockpiling chips at an unprecedented pace for the past 4 years – blamed the U.S. for the chip crunch rocking the global tech industry, saying Washington’s sanctions against Chinese companies have spurred panic buying of semiconductors and other supplies.

    “Because of the U.S. sanctions against Huawei, we have seen panic stockpiling among global companies, especially the Chinese ones. In the past, companies were barely stockpiling, but now they are building up three or six months’ worth of inventory … and that has disrupted the whole system,” Rotating Chairman Eric Xu said at the company’s 18th Huawei Analyst Summit, the Nikkei reported.

    And guess what that means for prices? According to Xu, this will entail at least $1 trillion in upfront investment, which will push up semiconductor prices by 35% to 65% and ultimately lead to higher costs of electronic devices for end users, he added, citing a recent report submitted to the White House by the Semiconductor Industry Association, the top U.S. chip industry alliance.

    In retrospect, Trump’s decision to place Huawei and other Chinese tech companies on trade blacklists that restrict their access to American technology was prophetic as their behavior demonstrates.

    “Clearly the unwarranted U.S. sanctions against Huawei and other [Chinese] companies are creating an industry-wide supply shortage, and this could even trigger a new global economic crisis,” Xu added.

    In other words, if Biden even thinks about thinking about imposing a fresh round of tariffs, the industry-wide chip shortage which is created by Chinese companies – but is entirely the fault of the US – will get far worse and lead to countless high-tech industries grinding to a halt.

    Meanwhile, and as we explained back in December 2018 in “This is What The “Trade” War With China Is Really All About”, where we said that “chips, or semiconductors, have become the central battlefield in the trade war between the two countries. And it is a battle in which China has a very visible Achilles heel”, other Chinese companies worry they will face a similar situation to Huawei, Xu said, adding that he believes there will be companies willing to invest in chip manufacturing to satisfy the needs of Huawei and other Chinese companies while maintaining compliance with U.S. rules.

    Huawei blames US for global chip supply crunch
    Chinese tech titan says sanctions have spurred damaging ‘panic-buying’
    https://asia.nikkei.com/Spotlight/Huawei-crackdown/Huawei-blames-US-for-global-chip-supply-crunch

    TAIPEI — Huawei Technologies on Monday blamed the U.S. for the chip crunch rocking the global tech industry, saying Washington’s sanctions against Chinese companies have spurred panic buying of semiconductors and other supplies.

    “Because of the U.S. sanctions against Huawei, we have seen panic stockpiling among global companies, especially the Chinese ones. In the past, companies were barely stockpiling, but now they are building up three or six months’ worth of inventory … and that has disrupted the whole system,” Rotating Chairman Eric Xu said at the company’s 18th Huawei Analyst Summit.

    The U.S. has placed Huawei and other Chinese tech companies on trade blacklists that restrict their access to American technology, citing national security risks.

    “Clearly the unwarranted U.S. sanctions against Huawei and other [Chinese] companies are creating an industry-wide supply shortage, and this could even trigger a new global economic crisis,” Xu added.

    Xu’s remarks come hours before the White House plans to host a summit aimed at addressing the chip shortage, with an emphasis on its impact on the automotive industry. Dozens of executives from U.S., Asian and European tech companies and automakers — including General Motors, Ford, Google, Intel, Taiwan Semiconductor Manufacturing Co., Samsung Electronics, and NXP — are slated to attend the event. White House officials have already acknowledged that the chip shortage may be difficult to solve in the short term.

    Xu said the U.S. trade restrictions on Huawei have not only undermined the company but also damaged the relationship of trust that existed in the global semiconductor supply chain. Now, he said, more and more countries are pushing to onshore chip production and boost their own tech self-reliance, rather than relying on cross-border supply chains. This will entail at least $1 trillion in upfront investment, which will push up semiconductor prices by 35% to 65% and ultimately lead to higher costs of electronic devices for end users, he added, citing a recent report submitted to the White House by the Semiconductor Industry Association, the top U.S. chip industry alliance.

    Reply
27. April 13, 2021 at 5:57 pm

    Tomi Engdahl says:

    A global semiconductor shortage and tensions with China have bolstered U.S. scrutiny of the supply chain and created a drive to regain leadership.

    How Asia came to dominate chipmaking and what the U.S. wants to do about it
    PUBLISHED SUN, APR 11 20218:05 PM EDTUPDATED SUN, APR 11 202111:36 PM EDT
    https://www.cnbc.com/2021/04/12/us-semiconductor-policy-looks-to-cut-out-china-secure-supply-chain.html?utm_term=Autofeed&utm_medium=Social&utm_content=Intl&utm_source=Facebook#Echobox=1618187535

    Taiwan’s TSMC and South Korea’s Samsung Electronics control more than 70% of the semiconductor manufacturing market.
    A global semiconductor shortage and tensions with China have bolstered U.S. scrutiny of the supply chain and created a drive to regain leadership.
    Under President Joe Biden, the U.S. is looking to bring manufacturing back to American soil and reduce reliance on a handful of chipmakers.

    Reply
28. April 15, 2021 at 9:08 am

    Tomi Engdahl says:

    Asian countries produce more than 70% of global semiconductors, with Taiwan and South Korea being unrivaled in high-end chip manufacturing capacity.

    Tough road ahead for U.S. firms trying to cut reliance on Taiwan chipmakers
    https://www.cnbc.com/2021/04/13/semiconductor-shortage-us-tech-companies-and-their-reliance-on-taiwan.html?utm_term=Autofeed&utm_medium=Social&utm_content=Main&utm_source=Facebook#Echobox=1618302695

    Asian countries produce more than 70% of global semiconductors — Taiwan and South Korea, in particular, have established unrivaled positions in high-end chip manufacturing capacity.
    U.S. tech firms rely on Taiwanese contract manufacturers to produce up to 90% of their chips, according to Sebastian Hou from CLSA.

    Taiwanese chipmakers are ahead of their international rivals and it will be tough for U.S. tech companies to reduce their reliance on Taiwan, said Sebastian Hou from CLSA.

    Tech firms like Apple, Amazon, Google as well as Qualcomm, NVIDIA and AMD rely heavily on Taiwanese contract manufacturers to produce up to 90% of their chips, according to Hou, who is managing director and head of tech research at the brokerage firm.

    “It’s going to be a challenging and long journey for them to diversify away, and thinking about how long it takes for the chip development and cooperation — it’s going to take a while,” he said Monday on CNBC’s “Street Signs Asia.”

    Semiconductors are used in everything, from smartphones and computers to cars as well as home appliances.

    While the United States dominates the global semiconductor market share by revenue, Asia is the manufacturing powerhouse, according to a recent report from Bank of America. Asian countries produce more than 70% of global semiconductors — Taiwan and South Korea, in particular, have established unrivaled positions in high-end chip manufacturing capacity, the report said.

    The global semiconductor shortage and geopolitical tensions with China has heightened Washington’s scrutiny of the supply chain. It has triggered a drive to bring manufacturing back to American soil to regain leadership and earmarked billions of dollars for its efforts.

    China’s SMIC lagging
    A report from market research firm TrendForce ranked China’s Semiconductor Manufacturing International Corporation (SMIC) fifth by revenue among the world’s top 10 foundries in February, based on estimated first quarter numbers.

    SMIC is China’s largest and most important chipmaker — it is seen as key to Beijing’s plans for self-sufficiency in the semiconductor space, following tensions with Washington.

    Reply
29. April 16, 2021 at 8:09 am

    Tomi Engdahl says:

    TSMC Q1 2021 Process Node Revenue: More 7nm, No More 20nm https://trib.al/Cg6ejv2

    https://www.anandtech.com/show/16621/tsmc-q1-2021-process-node-revenue-more-7nm-no-more-20nm?utm_medium=social&utm_content=anandtech&utm_source=facebook.com&utm_campaign=socialflow

    This quarter TSMC has hit record wafer production, some 50% higher than its recent Q1 2019 low point. In Q1 2019, TSMC had low demand for high-end smartphones, low customer demand due to oversupply/inventory digestion, and Q1 is typically lower seasonally anyway. But as we can see from the historical 5-year graph, traditional production for TSMC has been around 2.5-2.7m wafers per quarter.

    It is only recently that TSMC is pushing out over 3m wafers per quarter, indicating a good shift in demand as we are seeing of late. This is buoyed by TSMC’s newest Fab 18 facility which went into 5nm risk production in Q2 2019, and at full production is expected to manufacture 1 million to 1.2 million 12-inch wafers per year.

    As for where the revenue comes from, for the second straight quarter, in Q1 2021 7nm and 5nm combined accounted for almost 50% of the company-wide revenue. 7nm actually increased its revenue share, while 5nm revenue reduced.

    Reply
30. April 17, 2021 at 9:01 am

    Tomi Engdahl says:

    Taiwanese industry sources expect that the damage to TSMC’s output can reach million.

    TSMC Plant Hit By Power Outage – Millions Of Dollars In Damage Expected
    https://wccftech.com/tsmc-plant-hit-by-power-outage-millions-of-dollars-in-damage-expected/

    The Taiwan Semiconductor Manufacturing Company’s (TSMC) chip fabrication plant in the province’s Tainan sector experienced a power outage earlier today. This facility is responsible for fabricating semiconductors on the 12nm and higher process nodes, with its output primarily used to supply chips destined for automotive uses. It comes as the global automotive industry is dealing with a semiconductor supply crisis, and initial, unofficial estimates suggest that the damage could amount to millions of NT$.

    Power Supplier Taipower’s 161kV Cable Cut During Construction Process – Repairs Expected To Be Complete Tomorrow

    Due to the outage, Taiwanese industry sources expect that the damage to TSMC’s output can reach millions of NT$. While the company is yet to officially provide an update about the damage, with one expected tomorrow as TSMC evaluates the situation, up to 30,000 wafers are expected to be impacted due to the power breakdown.

    The P7 plant in the 14B factory in the center of the outbreak is believed to have a monthly production capacity of 40,000. Judging by this, the 30,000 wafer loss estimate seems to be exaggerated.

    Reply
31. April 17, 2021 at 9:52 am

    Tomi Engdahl says:

    Semi-Fulfilling Prophecy: Ongoing Chip Shortage Is Now Impacting Chipmaking Equipment
    https://www.zerohedge.com/markets/semi-fulfilling-prophecy-ongoing-chip-shortage-now-impacting-chipmaking-equipment

    It seems like every day, the ongoing semiconductor chip shortage continues to get worse. For example, yesterday we wrote that Taiwan Semiconductor was now warning that the global chip shortage may extend into next year, following comments we had reported on in early April suggesting that prices would rise for the rest of 2021.

    Now, the issue looks to be shifting to a shortage of chipmaking equipment, according to Nikkei. Delivery times for some chipmaking tools have grown to 12 months or more as a result of the supply crunch now spreading “so far that it is rebounding onto the chipmaking industry itself,” the report says.

    Wire bonding machines are experiencing a lead time of 10 to 12 months. They are used in the chip packaging process. Lead times for wafer dicing machines could be as long as 5 to 8 months, compared to the usual 1 to 3 months, the same people said. Mitsubishi Electric warned that lead times for laser drilling machines on printed circuit boards and chip substrates is not more than 12 months.

    One executive told Nikkei: “It’s not like we don’t want to increase our capacity, [but] even if we wanted to book more machines, we couldn’t get them very quickly. People are booking 50 or even 100 of Mitsubishi’s laser processing machines at a time. We have been told by [Mitsubishi] that its capacity is fully booked because demand is so strong, and if we want to order new machines now, we will have to wait until next year for them to be available.”

    Reply
32. April 18, 2021 at 6:48 am

    Tomi Engdahl says:

    The Complex Global Supply Chain Of Semiconductors Explained In One Chart
    https://www.zerohedge.com/markets/global-supply-chain-semiconductors-explained-one-chart

    The global supply chain of a semiconductor chip is complex and spans the globe.

    For example, a camera image sensor produced by On Semiconductor is first created with wafers in Taiwan for packaging and testing, then to Singapore for storage, then on to China for assembly into a camera unit. The camera unit is sent to a Hyundai component supplier in Korea before being mounted on Hyundai vehicles in auto factories around the world, according to Reuters.

    A shortage of that image sensor has resulted in Hyundai Motor’s plant’s idling in South Korea. Other automakers such a Ford Motors Co, General Motors Co, and Volkswagen are experiencing issues.

    The example of On Semiconductor’s image sensor winding journey around the world shows just how difficult it is for the chip industry to increase capacity to address the current shortage.

    Meanwhile, President Biden is attempting to address the shortage and has called for a massive effort to bolster the domestic chip industry. He’s proposed $50 billion to build out the chip industry as part of his $2 trillion infrastructure proposal. In doing so, the chip supply chain would be far less complex and able to adjust to market fluctuations much quicker.

    Currently, the US only produces 12% of worldwide semiconductor manufacturing capacity, down a whopping 37% since 1990. Asia, on the other hand, commands more than 80% of the chip manufacturing market.

    Reply
33. April 18, 2021 at 4:01 pm

    Tomi Engdahl says:

    Audio metering

    BBC notes on the PPM, schematics included.
    http://www.bbceng.info/ti/eqpt/AM20_3.pdf

    Reply
34. April 18, 2021 at 7:51 pm

    Tomi Engdahl says:

    Nikkei Asia:
    Sources: at least four types of equipment vital to chip production are in short supply and lead times for wire bonding machines have grown to 10-12 months

    Chip tools become latest victim of global semiconductor crunch
    Longer delivery times mean slower ramp-up of production capacity
    https://asia.nikkei.com/Business/Tech/Semiconductors/Chip-tools-become-latest-victim-of-global-semiconductor-crunch

    Trying to solve the global chip crunch? You will need more chipmaking machines. But you won’t be able to get them — because of the shortage of chips.

    This conundrum is the latest sign of how the global semiconductor supply crunch is now spreading so far that it is rebounding onto the chipmaking industry itself.

    Delivery times for some critical tools have grown to 12 months or more, Nikkei Asia has learned, which will slow capacity expansion plans for a wide range of suppliers, including chip manufacturers, packaging and testing service providers and substrates suppliers. The global component shortage is already affecting some of the world’s biggest buyers of chips, including Apple and Samsung Electronics.

    At least four types of vital production equipment are in short supply, according to industry sources.

    “Some of these equipment makers are also suffering from chip shortages and some are struggling with labor issues due to pandemic lockdowns, like all the other tech players, and that weighs on the process of building machines,” said one of the people with direct knowledge of the situation. “COVID-19 lockdowns had disrupted production since last year and just when it was about to recover, the serious chip and component shortage hit them.”

    The lead time for wire bonding machines, mainly supplied by Singapore-based Kulicke & Soffa, has grown to 10 to 12 months, sources said.

    For wafer dicing machines, which are used to slice wafers into chips, the delivery time could be as long as 5 to 8 months thanks to the unprecedented demand

    Delivery times for chip testing machines made by Advantest of Japan and Teradyne of the U.S., among others, have also grown significantly.

    For laser drilling machines used on printed circuit boards and chip substrates, leading equipment maker Mitsubishi Electric has warned clients that the lead time for some tools is now more than 12 months for orders placed from now on. The lead time for high-end chip substrates has lengthened to 52 weeks.

    “It’s not like we don’t want to increase our capacity, [but] even if we wanted to book more machines, we couldn’t get them very quickly,”

    Travel restrictions imposed to fight COVID-19 are also hampering equipment delivery and installation, as personnel are usually dispatched to help clients install and test the machines. Some equipment suppliers have tried using virtual reality headsets and simulation software to remotely guide clients through the process, but some critical support must still be provided on-site.

    “We are trying to find alternative equipment suppliers for drilling machines [for auto parts], but the precision and speed are just not as satisfactory as what we used to have,” Chairman David Shen of Hota Industrial Manufacturing, a key automotive parts supplier, told Nikkei Asia.

    Reply
35. April 18, 2021 at 7:51 pm

    Tomi Engdahl says:

    The $490bn question: Can the world afford its Taiwan chip dependence?
    Biden looks to make supply chains more resilient, but it will not be cost-free
    https://asia.nikkei.com/Business/Tech/Semiconductors/The-490bn-question-Can-the-world-afford-its-Taiwan-chip-dependence

    Reply
36. April 20, 2021 at 10:48 am

    Tomi Engdahl says:

    UK invokes national security to investigate Nvidia’s ARM deal
    https://www.reuters.com/world/uk/uk-intervenes-nvidias-takeover-arm-national-security-grounds-2021-04-19/

    The UK government will look into the national security implications of U.S. group Nvidia’s (NVDA.O) purchase of British chip designer ARM Holdings, it said on Monday, raising a question mark over the $40 billion deal.

    Digital minister Oliver Dowden said he had issued a so-called intervention notice over the sale of ARM by Japan’s SoftBank (9984.T) to Nvidia.

    “As a next step and to help me gather the relevant information, the UK’s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions,” he said.

    Nvidia said it does not believe the deal poses any material national security issues.

    Reply
37. April 20, 2021 at 11:17 am

    Tomi Engdahl says:

    https://etn.fi/index.php/13-news/12026-kiinalaisyritys-kiihdyttaa-dram-muistin-yli-haamurajan

    DRAM-muisteissa on alkamassa siirtymässä DDR5-polveen. Sen myötä moni sovellus nopeutuu merkittävästi. Mutta kuinka nopea on nopein DDR5-muisti? Kiinalainen Netac puhuu jo 10 000 megahertsin kellotaajuudesta.

    DDR5-standardin perusversio on määritelty 4800 megahertsiin. Jo DDR4-muisteista tiedetään, että nopeus voi kasvaa merkittävästi määrityksiä korkeammaksi.

    Reply
38. April 20, 2021 at 7:58 pm

    Tomi Engdahl says:

    UK government intervenes in Nvidia takeover of Arm, cites ‘national security’
    https://appleinsider.com/articles/21/04/19/uk-government-intervenes-in-nvidia-takeover-of-arm-cites-national-security?utm_medium=rss

    The UK’s Competition and Markets Authority has been ordered to investigate Nvidia’s proposed takeover of British company Arm, the company whose technology is used by Apple Silicon.

    Nvidia’s record-breaking $40 billion purchase of Arm has already been opposed by the likes of Qualcomm, and has been examined by the UK’s Competition and Markets Authority (CMA). Now the UK wants to step up its CMA activity with a “phase one” investigation over national security concerns.

    Reply
39. April 20, 2021 at 11:55 pm

    Tomi Engdahl says:

    Wall Street Journal:
    An in-depth look at the reasons behind the chip shortage, including focus on higher-margin, cutting-edge chips, and stockpiling due to US China trade tensions — Semiconductor producers are trying to increase output, but the small gains are unlikely to fix the shortfalls hampering production …

    Tech

    Why the Chip Shortage Is So Hard to Overcome
    https://www.wsj.com/articles/why-the-chip-shortage-is-so-hard-to-overcome-11618844905?mod=djemalertNEWS

    Semiconductor producers are trying to increase output, but the small gains are unlikely to fix the shortfalls hampering production of everything from cars to home appliances to PCs

    The world’s leading suppliers of semiconductors are pushing to overcome the prolonged chip shortage that has hampered production of everything from home appliances to PCs to autos.

    Chip makers are trying to eke out more supply through changes to manufacturing processes and by opening up spare capacity to rivals, auditing customer orders to prevent hoarding and swapping over production lines. The bad news is, there are no quick fixes, and shortages will likely continue into next year, according to the industry’s executives.

    On top of a spike in demand, producers have been hamstrung by a series of freak events that have knocked out supply, while ongoing U.S.-China political frictions and concerns of a prolonged shortage have prompted some manufacturers to stockpile chips.

    The current shortfall includes the less-advanced chips that the industry’s biggest players have been pulling away from to pursue higher-margin, cutting-edge chips. Building new production capacity usually takes years.

    That could slow down the post-pandemic recovery for certain industries that use the chips that are looking to take advantage of rising consumer spending. It also feeds into inflation concerns as higher chip costs can stoke prices throughout the economy.

    Chip makers can add only incremental boosts to capacity from existing plants, executives say. Building a new fabrication plant can take years because of the scale and complexity of equipment and space needed to make semiconductors.

    Major chip makers made big strategic bets on the more-profitable advanced chips needed for things such as 5G and servers. The approach hit a glitch when the coronavirus plunged the global economy into one of its worst recessions, rattling supply chains and consumer spending patterns. That left chip makers ill-equipped to deal with the high demand for older, less-sophisticated semiconductors used widely in products such as cars, computer monitors, speakers and appliances—products that have been hoovered up during the pandemic.

    The supply crunch was exacerbated by U.S.-China trade tensions, especially during the past year, including Washington policies that gradually restricted the sale of American-designed or -made chips to some Chinese buyers. Fears of sanctions prompted tech companies in China to stockpile chips and prepare for the worst, Huawei Technologies Co. deputy chairman Eric Xu said last week. The Chinese company uses a range of chips in its telecommunication products and consumer gadgets, and aggressively stockpiled components to protect against U.S. export restrictions.

    “Now [the Chinese companies] are stockpiling for one month, three months, or even six months, and they have disrupted the whole system,” Mr. Xu said. China’s semiconductor imports soared 15% last year and hit a record $35.9 billion in March, Chinese customs figures show.

    Chip production was disrupted by events including a plant fire in Japan and freezing weather in the southern U.S. that shuttered production lines. A drought in Taiwan, a major chip-making hub, threatens to further reduce the industry’s output, since large amounts of water are used in the process.

    Manufacturers of products that use chips are stepping up production in expectation of a post-pandemic economic recovery. The surge in chip demand is pushing up prices and extending already historically long wait times. Auto makers including Toyota Motor Corp. and General Motors Co. have been forced to idle or reduce production at some plants.

    Some buyers say they face delays of half a year or longer. “You ask on Monday, it’s a 12-week lead time. Then you ask on Wednesday and it’s a 27-week lead time,”

    Semiconductors are the lifeblood of many industries—ranking as the world’s fourth-most traded product counting imports and exports, after crude oil, refined oil and cars.

    For years, the world’s biggest chip makers plowed investment into capacity to feed demand for the next generation of semiconductors, and shifted their focus away from the production of more-basic chips.

    But autos and home electronics are packed with lots of the more rudimentary components. These include power-management chips, a basic chip that regulates the flow of electricity in a device, and microcontrollers, the workhorses that run a host of functions.

    “There isn’t an electronic device that doesn’t have a microcontroller in it,” GlobalFoundries’ Mr. Caulfield said. “This is pervasively in short supply.”

    Even advanced electronic gadgets need some basic chips to operate

    A typical 5G smartphone can hold as many as eight power-management chips, compared with two to three in a 4G phone

    Last year, 27% of all spending on chip-making equipment went to tools for building the industry’s most-advanced chips, according to research firm Gartner Inc., which are often used in smartphones, high-end PCs and data centers. Less than half that portion, about 11%, went to equipment for cranking out more commoditized chips

    Switching existing production lines from making one type of chip to another isn’t easy because different types of chips require different equipment to make, though there can be some overlap.

    There hasn’t been a time when the shortage has affected so many types and brands of chips all at once

    It usually takes at least two years to build and equip a semiconductor fabrication plant, known as a “fab,” which can cost billions of dollars.

    Once fabs are built, a chip typically takes three months to make—or longer for the most-advanced ones.

    Semiconductor makers must decide whether to make multibillion-dollar bets on whether this surge will last or taper off by the time new plants are up and running. Many are reluctant to alter long-term spending plans based on demand surges that could be short-lived.

    Still, the biggest semiconductor companies are setting aside huge sums to boost overall capacity. TSMC earlier this month unveiled the industry’s largest-ever investment, allocating $100 billion over the next three years to boost capacity. Most of the company’s near-term spending, however, will go toward building the most-advanced chips. In the U.S., Intel Corp. last month pledged $20 billion for two sites in Arizona and signaled further investment commitments are to come this year. South Korea’s Samsung Electronics Co. has earmarked $116 billion in investment by 2030 to diversify chip production.

    China’s biggest chip maker, Semiconductor Manufacturing International Corp. , last month committed $2.35 billion with a government partner to build a new factory focused on older chip-making processes. The company anticipates the new facility to start production next year. But delays in getting new chip-making equipment is an obstacle to increasing output

    Chip makers are seeing a doubling, if not quadrupling, of delivery times for the machinery required to make semiconductors

    “You’re seeing a lot of customers saying, ‘I’m not going to let that happen again, my business is too important,’ ” Mr. Caulfield said.

    At Intel, Chief Executive Pat Gelsinger said the company would make some of its production capacity available to produce chips in particular short supply and needed by auto-component makers. Supply could start improving in six to nine months, Mr. Gelsinger said in an interview.

    Guy Eristoff, chief strategy officer at Israel-headquartered foundry Tower Semiconductor Ltd. , said chip production can be sped up to 3.5 times the usual time in rare cases by sorting production lines so that high-priority chips pass through quickly. Some equipment can be operated for longer before going into preventive maintenance, though this can come at the cost of lower yields.

    Altogether, these measures mean some chips can be churned out in 30 to 40 days from the usual 120 days

    Suppliers are wary that the surge in demand may not last, with panicked buyers increasing order volumes or placing orders with multiple companies.

    Auto makers are among the buyers that have felt the shortage most acutely, as cars need more semiconductors than ever before. Electronics made up more than 40% of a car’s total cost in 2017, doubling from that in 2007, according to consulting firm Deloitte.

    Their use is expected to grow, along with costs. German auto-chip maker Infineon Technologies AG said it expects the cost of chips in autonomous vehicles to jump to about $1,200 by 2030 from about $170 currently required for “Level 2” vehicles, or partly automated cars.

    “Money is almost not even an issue these days. It’s about what you can get,”

    “Somebody’s business can get hurt.”

    Reply
40. April 24, 2021 at 4:10 pm

    Tomi Engdahl says:

    Intel and TSMC say chip shortage could last until 2022 or beyond
    ‘It just takes a couple of years to build capacity.’
    https://www.pcgamer.com/intel-and-tsmc-say-chip-shortage-could-last-until-2022-or-beyond/

    Intel and TSMC are two of the largest chipmakers in the world, and that’s why when both agree that today’s chip shortage may continue until 2022, if not beyond, it’s something we must take very, very seriously

    Reply
41. April 24, 2021 at 5:03 pm

    Tomi Engdahl says:

    https://spectrum.ieee.org/tech-talk/computing/hardware/nvidia-supercomputing-cpu-puts-intel-under-pressure

    Reply
42. April 24, 2021 at 5:10 pm

    Tomi Engdahl says:

    Technology 22:14, 17-Apr-2021
    ‘Historic breakthrough’: Chinese chipmaker unveils self-developed CPU architecture
    https://news.cgtn.com/news/2021-04-17/Chinese-company-unveils-self-developed-CPU-architecture–ZvSw4KIJq0/index.html

    Reply
43. April 24, 2021 at 5:36 pm

    Tomi Engdahl says:

    The Complex Global Supply Chain Of Semiconductors Explained In One Chart
    https://www.zerohedge.com/markets/global-supply-chain-semiconductors-explained-one-chart

    Reply
44. April 26, 2021 at 11:37 am

    Tomi Engdahl says:

    https://etn.fi/index.php/13-news/12051-silicon-labs-luopuu-verkkopiireista-jattikaupassa

    Teksasin Austinissa päämajaansa pitävä Silicon Labs kertoo myyvänsä verkkolaitteiden ja ajoneuvojen piiritoimintansa Skyworks Solutionsille. Yhtiö keskittyy täysillä IoT-markkinaan. 2,75 miljardin dollarin kaupassa katoaa samalla 40 prosenttia liikevaihdosta.

    Reply
45. April 26, 2021 at 11:39 am

    Tomi Engdahl says:

    https://www.uusiteknologia.fi/2021/04/26/uudenkaupungin-autotehdas-seisoo-osapulan-takia/

    Reply
46. April 26, 2021 at 11:40 am

    Tomi Engdahl says:

    https://etn.fi/index.php/13-news/12058-2-6-biljoonan-transistorin-tekoalypiiri

    Reply
47. April 26, 2021 at 11:40 am

    Tomi Engdahl says:

    https://etn.fi/index.php/13-news/12057-dram-hinnat-nousevat-lapparisi-kallistuu

    DRAM-piirien sopimushintojen odotetaan nousevan 18-23 prosenttia vuoden toisella neljänneksellä. PC- ja palvelinkoneissa DRAM-muistien hinnat nousevat yli 20 prosenttia tutkimuslaitos TrendForcen mukaan. Jollakin aikataululla uusi läppärisi siis kallistuu.

    Reply
48. April 29, 2021 at 11:17 am

    Tomi Engdahl says:

    https://www.uusiteknologia.fi/2021/04/29/teknologiateollisuuden-kysynta-jatkui-vahvana/

    https://etn.fi/index.php/13-news/12079-komponenttipula-uhkaa-teollisuuden-kasvua

    Reply
49. April 29, 2021 at 11:50 am

    Tomi Engdahl says:

    AMD’s Ryzen CPU refresh may have been cancelled due to the chip crisis
    By Alan Dexter 2 days ago
    https://www.pcgamer.com/amds-ryzen-cpu-refresh-may-have-been-cancelled-due-to-the-chip-crisis/?utm_medium=social&utm_source=facebook.com&utm_campaign=socialflow

    Rumours have it that the ‘Warhol’ Zen 3+ range has disappeared from AMD’s roadmaps.

    Reply
50. April 29, 2021 at 12:14 pm

    Tomi Engdahl says:

    Semiconductor industry fab spending expected to reach new highs
    The global semiconductor industry is on track to register three consecutive years of record highs in fab equipment spending thanks to demand fueled by COVID-19.
    https://www.controleng.com/articles/semiconductor-industry-fab-spending-expected-to-reach-new-highs/

    Reply