Global chip shortage hitting everybody but Apple — analyst

From “Samsung Warns of Severe Chip Crunch While Delaying Key Phone” posted last Wednesday on Bloomberg:

Samsung Electronics Co. warned it’s grappling with the fallout from a “serious imbalance” in semiconductors globally, becoming the largest tech giant to voice concerns about chip shortages spreading beyond the automaking industry.

Samsung, one of the world’s largest makers of chips and consumer electronics, expects the crunch to pose a problem to its business next quarter, co-Chief Executive Officer Koh Dong-jin said during an annual shareholders meeting in Seoul. The company is also considering skipping the introduction of a new Galaxy Note — one of its best-selling models — this year, though Koh said that was geared toward streamlining its lineup…

“The tightened supply of Qualcomm AP chips produced by TSMC is affecting everybody except Apple,” said MS Hwang, analyst at Samsung Securities. “PCs will soon be hit due to the short supply of display driver ICs, and the profitability of TV will be affected by soaring LCD panel prices.”

My take: Three words… Supply chain management.

7 Comments

  1. Romeo A Esparrago Jr said:
    SCM is hard. Very hard.
    Even for Apple.
    But it’s telling. Very telling.
    That Apple is the exception, not the rule.

    Buy AAPL.

    18
    March 23, 2021
  2. Gregg Thurman said:
    How long before somebody claims Apple is a monopoly and caused chip shortages by buying up (and pre-paying) TSMC production capacity from 2019 through xxxx?

    Wait for it, how long before there’s a congressional committee called together to investigate Apple’s role in the shortage?

    5
    March 23, 2021
  3. Jerry Doyle said:
    In its initial year the Power Mac was the top selling multimedia PC. In 12 months starting in March 1994 the company sold 1.2M Power Macs. The “San Francisco Chronicle” called it a banner year for the product line but, Apple could have sold “significantly” more for the new product line. Customers had to wait up to 2 months to get one. In their book, “Supply Chain Redesign,” Robert Handfield & Ernest Nichols said Apple was unable to obtain timely deliveries of critical parts, including modems & custom chips, thus unable to capitalize on the product demand. The company had $1B in unfilled orders in the system because it did not have the necessary inventory capacity.

    The industry publication “Supply Chain Digest,” ranked Apple as one of the worst “greatest supply chain disasters” in history. Steve was determined not to see the same mistake upon his return to Apple. Consequently, Steve reluctantly compromised his desire for tight control over both hardware & software through running Apple’s own manufacturing into efficiency through outsourcing, an anathema to him.

    Continue…..

    2
    March 23, 2021
  4. Jerry Doyle said:
    Continued….

    Steve wanted build “just-in-time” factories similar to Michael Dell’s expertise. This is when Steve found Tim Cook. In 1998 when Tim Cook joined Apple the PowerBook production was outsourced to Quanta in Taiwan. Over the next few years Cook accelerated the entire outsourcing process.

    Many people persuaded Cook not to leave Compaq & in a commencement address at Auburn Tim even mentioned that there was a well known CEO who told Tim he would be a “fool to leave Compaq.”

    Cook had not planned to join Apple. He later said it was Steve’s infamous persuasive ability that instilled enthusiasm to move over to Apple & work with Jobs. So, delivering from manufacturing-to-customer came-of-age and no longer existed warehouses collecting products.

    7
    March 23, 2021
  5. bas flik said:
    in the end this will have an impact on Apple as well.
    everywhere there is just in time logistics
    when this gets disrupted you are in trouble
    50 years of automating logistics
    all inventory buffers have disappeared
    this is nice when the sun is shining
    but where you can hide when its raining
    takes years to solve this problem

    2
    March 24, 2021
  6. A recent fire in a plant that makes chips for the auto industry is only going increase supply shortages, for certain semiconductors. TSM & others are building new fabs, but not for “old school” requirements like internal combustion cars. EV’s, wind power, battery management and IoT needs are the priority. New designs like the M1 and an upcoming 3 nanometer chip TSM is preparing to fabricate for ‘a major client’ are all about the future. Funny how tech advances are rapidly making fossil fuels hard to sell.

    2
    March 24, 2021
  7. Jim Fournier said:
    My take: Two words…Tim Cook.

    8
    March 24, 2021

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