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Why There Is a Global Chip Shortage

Global Pandemic? Don’t tell semiconductor chip makers and the product manufacturers that need them.

Supply chains aren’t just dealing with shipping containers getting stuck in the Suez Canal, there’s a global semiconductor chip shortage but why?

Reuters, explains:

  • Sanctions against Chinese companies
  • Manufacturers are stockpiling chips for fear of on-going shortages (thus exascerbating the problem)
  • Huge consumer demand for products that require semiconductor chips
  • Auto makers have to slash their production targets due to the chip shortages (as modern automobiles are heavily reliant on chips for their on-board computersand electronics)
  • Chip manufacturers have been unable to keep up with demand 

The end result is driving higher prices for everything from autos, smartphones, computers and appliances.

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