Electronics shortages to continue throughout 2022: Mustek

The entire computer component supply chain remains severely constrained and will likely stay that way throughout the rest of the year, JSE-listed technology distributor Mustek has warned.

With shortages locally (and globally) of everything from graphics cards to Apple’s iPhone 13 to Sony’s PlayStation 5 and Microsoft’s Xbox Series X, it’s affecting computer distributors and retailers across the board.

And, of course, it’s been documented how the semiconductor shortage is harming the automotive industry. Even getting chips to power modern fridges and other white goods is proving challenging.

Initially caused by the surge in demand as Covid-19 hit and workers suddenly needed to be equipped with computer equipment to help them work from home, the shortage has since morphed into a wider global problem.

“Chips is just one part of the supply chain in our industry that is under pressure. The entire PC component supply chain is severely constrained, and we expect it to remain so throughout 2022,” said Mustek chief technology officer Dimitri Tserpes.

“OLED and LCD displays are severely impacted by a lack of integrated circuits (ICs). Power ICs, resistors and capacitors are in short supply and most producers are at maximum capacity,” Tserpes said. “This demand is even impacting supply on sensors (motion, presence, temperature, etc), cables, connectors and even PCBs (printed circuit boards).”

And it is not only the shortage of components that is making things difficult for industry players. Tserpes said meeting demand is challenging. Planning and logistics are impacted when distributors cannot get confirmed manufacturing dates from suppliers.

“For large tender-based businesses, there is no flexibility. Tenders are awarded based on evaluation models and no variations are allowed.”

Miners vs gamers

Another contributing factor to the shortage is the demand for graphics hardware in the cryptocurrency world. Crypto miners need the same semiconductors to power their mining hardware that’s used by gamers, and this has put extra strain on manufacturers and distributors. It’s also created friction between gamers and crypto miners as the price of graphics cards has surged in the absence of sufficient supply to meet demand.

Another industry that is suffering from the shortage is the motor industry. With cars needing more and more chips to function, this crisis may even lead to job losses as there are not enough cars to sell and so car dealers may have to close. Modern cars need a lot more help from computer chips for everything from navigation and automatic braking to power steering.

“Even with the unprecedented amounts of capital committed to solving the chip crisis (some half a trillion dollars), plants can’t be built overnight. Most of this investment won’t result in a change to production capacity until at least 2024,” said Tserpes. “This investment is also going primarily to latest-generation, high-profit plants – because who wants to build plants for legacy chips?”  — (c) 2022 NewsCentral Media