Chip shortage begins to affect smartphone production

Tram Ho

The impact of Covid-19 caused chip factories to close recently. This situation makes the car industry seriously affected when big companies like General Motors or Ford even have to stop producing certain models.

Game console manufacturers like Microsoft and Sony are in a similar situation. Along with that are the manufacturers of video cards for PC gamers.

Smartphones have so far been unaffected, thanks to the fact that Apple or Samsung have stockpiled key components in advance.

Thiếu hụt chip bắt đầu ảnh hưởng tới sản xuất smartphone - Ảnh 1.

Part of the reason is because car manufacturers use older chips, while smartphone manufacturers always use newer chips, which are prioritized to deliver orders sooner.

What’s more, phone makers did not reduce chip orders while car manufacturers did in anticipation of a drop in demand for cars because of the pandemic.

But recently, car makers and other sectors have caught up with smartphone chip supply while phone market sales grew 26% in the first quarter of 2021, according to Gartner. This is the pressure in the coming time for smartphone manufacturers.

Warning from Apple

On Tuesday (July 27), CEO Tim Cook warned that chip supply will affect iPhone production as well as other products such as iPads.

This shortfall is not in the Apple processor chip that is actively supplied, but in all other functions that need the chip such as screen, sound.

While Apple has always been the most important customer for chipmakers, chip shortages are no longer just a matter of CPUs or GPUs in personal computers.

Manufacturers like Lenovo, TCL or HMD Global are also struggling with this situation. And smaller manufacturers face an even greater challenge because they are not a priority customer.

That doesn’t mean giants like Apple or Samsung aren’t affected, though. In April, the Korean electronics giant had to close its factory in Austin, Texas (USA) for a whole month because a snowstorm caused widespread power outages.

The chip shortage caused Samsung to say it might not announce a new Galaxy Note model. The company just reported a 54% jump in profits for the second quarter of 2021, but warned of a chip shortage that affected its full-year revenue forecast.

Analysts say chip shortages could affect up to 10% of manufacturers’ forecast output. That may not be a shortage of new models like the iPhone 13 but older models when the chip is prioritized for new models.

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Source : Genk