The great semiconductor drought may be about to break It's not your imagination – it really is getting easier to find critical semiconductors. According to Susquehanna, a company that researches markets to inform its complex equity trading strategies, semiconductor lead times were down four days on average last month. "September represents the first real signs of [lead time] …
I suspect this hell has been caused by beancounters who don't understand their market. It's been coming for a long time.
The fabs have been stopping making the boring cheap things using ancient processes, and building capacity for the flagship high-value components.
Nevermind that the actual profit is higher on the cheap things, because the market is vastly larger. Sell one $50 CPU and make $25 or a hundred $1 support components and make $40?
> I suspect this hell has been caused by beancounters who don't understand their market. It's been coming for a long time.
I suspect the same thing. Far too many businesses have been squeezing everything they could possibly squeeze, in a process that has been hailed in glory and variously called "being efficient", "having a lean supply chain", "no-inventory model", "being able to rapidly adapt" and so on and so forth.
In reality, they were just basically bundling up the company's ability to withstand shocks, and selling it for a quick buck. If everyone does it, then entire value chains become like chunks of rigid materials stacked up one against the other: there's nothing elastic that can absorb the shock, so the shock goes right through the whole lot.
And when the shit eventually hits the fan, the managers who made those short-sighted decisions will be gone anyway. Even if they aren't gone, they'll just claim the shit was completely unpredictable, and they can't possibly be at fault, because after all if you see a trend for five years, it's guaranteed to go on forever, right? Right?
Unfortunately, taking short-sighted decisions really does boost your company in the short term. If all of your competitors do it, and the market manages to avoid shocks for a few years, eventually you will be forced to do it too, or get squeezed out.
The whole "Just in Time" idea works very well when all suppliers are stable and can immediately meet your orders.
When reality bites and a vital $1 part can not be supplied in time then a whole production line sits idle - the few cents per item saved by JIT in the good times is overwhelmed by the costs of JIT in bad times where one (or more) vital components are not available in time.
"Old fashioned" manufacturing kept piles of stock at factories to allow for delays and holdups in deliveries (eg strikes/bad weather/fires etc) - it cost more in good times but avoided expensive idle time in bad times. Unfortunately far too much senior management assumes that the good times will persist forever.
Icon for the shareholders of a company whose plants can not operate due to JIT failing ====>
If i go to Mouser then they have stock on products that UK Farnell are stating is 1 year for delivery.
Even relays and power entry modules are unavailable for 6moths to a year, or require a quotation to purchase.
The market is still a mess, and i thought it would have recovered by now.
could provide some very welcome breathing space for the Chip makers.
Firstly, to reduce their backlogs which are for some products longer than 1 year.
Then to build their new fabs which should come online just in time for the end of the recession.
Or... maybe not?
96K ATMEGA328P-AU available next July on Mouser, just one example of an MCU we use in one commercial line. We redesigned using a 4808 last year as we could get a few thousand in 6 months (which were ordered) now we need more, available next August.
As you can see, everything getting back to normal is carp.
But I have used the Raspberry Pi 4 as my benchmark to measure typical lead times on products.
They are still on sale at certain establishments here in Japan for well over $200 US. This seems to be down marginally from a peak of just over $300. But most of that decline is due to the falling Yen, nothing to do with the market improving.
4 days on a year lead time could be considered random noise.
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