Pundits and tech industry veterans have long expected global semiconductor shortages to last for years, but Intel CEO Pat Gelsinger now says it could be longer than previously expected. The CEO told CNBC’s TechCheck that he expects the problem to drag on into 2024 as the shortage has now hit device manufacturing. This could make it difficult for companies to obtain key manufacturing tools and hit production targets, which could be larger than before due to growing demand.
Gelsinger told the publication:
“That’s one of the reasons we think the overall semiconductor shortage will now drift into 2024 from our earlier estimates of 2023 into 2024, just because the shortage has now hit the equipment and some of those factory ramps are becoming more challenged.”
Lockdowns related to the COVID-19 pandemic had severely impacted the chip industry at a time when demand was rising. It forced not only tech companies, but also automakers like GM and Ford to cut back or even shut down production. Apple’s MacBook and iPad shipments faced delays due to component shortages, and smartphone shipments in general slumped in late 2021. This negative impact on the tech and auto industries led to devastating economic consequences – according to CBS News, global chip shortages cost the United States $240 billion in 2021, based on expert estimates.
Gelsinger previously said he believes the situation will continue into 2023, which is in line with expectations from analysts and other industry executives. After Gelsinger became Intel’s CEO, the company had announced several massive investments to expand chip manufacturing outside of Asia. (Notice that a late 2021 Bloomberg report claimed that the White House “strongly discouraged” Intel from ramping up chip production in China.) Intel said it will spend $20 billion to build two chip factories in Arizona and spend another $20 billion at least to build “the world’s largest silicon manufacturing site” in Ohio.
All products recommended by Engadget are selected by our editorial team independently from our parent company. Some of our stories contain affiliate links. If you buy something through one of these links, we may receive an affiliate commission.