Deloitte: the end of the shortage of semiconductors is near

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Semiconductor chips have been in short supply for the past two years as the supply chain has been skewed by the pandemic.

The shortage has impacted the entire electronics food chain, as chips are the building blocks of everything electronics.

The shortage was complicated because complex devices such as game consoles can require thousands of components. If a single $1 chip isn't available, it could delay the shipment and sale of a far greater value device, device or vehicle, Deloitte said.

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As recently as December, Deloitte Consulting predicted the shortage would last through 2023. But now the company's chip analysts believe the end is near, as the chip industry has increased capital expenditure and much-needed factories start up. to come online after long construction projects. Demand is also starting to shift as a slowdown in the global economy is expected. Inflation fears have dragged stocks down, and fears of a recession are prompting buyers and consumers to be more cautious.

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Meanwhile, chipmakers are waiting for the US Congress to approve the Bipartisan Innovation Act (CHIPS Act) to provide subsidies for factories to be built in the United States. Intel recently delayed the grand opening of a chip factory at a $20 billion facility in Ohio due to legislative uncertainty. (I was unable to ask Deloitte to comment on pending legislation).

I spoke to Chris Richard and Brandon Kulik, both heads of the semiconductor consulting business at Deloitte. They have decades of experience in the industry.

Here is an edited transcript of our interview.