Up to 18 Month Delay for Semiconductor Manufacturing Equipment

Industry sources speaking to Nikkei Asia are painting a somewhat dreary picture as to the current and future supply of electronics. According to the publication, chipmakers attempting to expand their production capacity are being met with increasingly long lead times, some reaching the 18-month mark. This is likely to put a dent on the speed at which new semiconductor factories from the likes of Intel and TSMC enter production, which could, in turn, translate into longer than previously thought supply constraints for consumer-facing electronics.

While the industry itself is still reeling from the COVID-19 pandemic and the supply constraints rising from the Russia's invasion of Ukraine, the tech industry's growth continues at an astonishing space. As more and more appliances receive the smart treatment, the requirements for the prime materials increase lock-step with the increasing amounts - and complexity - of electronics.

While companies such as ASML, Intel and TSMC have the clout to essentially pay whatever is required (up to a point) in a constrained market, the same isn't true for the smaller players in the semiconductor supply chain. These are faced with a hard decision: they can invest in scaling their production to address the current and near-future supply constraints, but they could then be faced with too much capacity when the supply / demand equation finally regains balance. That is at least one of the reasons why smaller players are being more cautious in increasing capacity. Perhaps the industry must face the uncomfortable possibility of these increased lead times actually becoming the new "normal".

Francisco Pires
Freelance News Writer

Francisco Pires is a freelance news writer for Tom's Hardware with a soft side for quantum computing.

  • bigdragon
    Market delays, shortages, high costs, inability to attract and retain talent, logistics problems. schedule delays, lack of capacity, and all these other problems appear to be commonplace whether it affects the product being built or the facility being built to make the product. Curious how there's no problem attracting and retaining executives. So many companies and industries have enormous challenges and systemic faults, but executives and boards are doing just fine. Hmm.
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