The price of iPhones and consoles may increase in 2021

Due to a shortage of semiconductors, electronic products are expected to be fewer and more expensive.

Prices for PlayStations and iPhones could rise this year due to a semiconductor shortage due to an explosive cocktail: boom in demand for electronics, supply chains disrupted by Covid and trade war, experts warn .

During lockdowns due to the Covid-19 pandemic, consumers have flocked to computers, tablets or game consoles, which work with chips. Meanwhile, tech giant Huawei, seeing the trade war between China and the United States escalate, stockpiled semiconductors last year, increasing pressure on supply.

These tensions in the market became glaring when automakers sought to source more semiconductors, and realized that manufacturers were prioritizing consumer electronics. The automotive industry is the most visible victim of the chip shortage to date, with giants like Ford and Volkswagen forced to cut production, but other sectors are also affected.

«Combination of coronavirus storm, spikes in inventory due to trade war, and paradigm shift of telecommuting is causing semiconductor shortage“Neil Mawston, executive director of consulting firm Strategy Analytics, told AFP. “Everything that has a chip is affected, cars, smartphones, game consoles, tablets and laptops». «Electronic goods and vehicles will be produced in fewer numbers and will be more expensive in 2021“, He predicts.

Complex supply chain

Shipments of some iPhone 12 models have been limited due to a lack of components, according to the Bloomberg agency. While a deficit of certain chips has been cited to explain the difficulties in obtaining the new PlayStation 5 from Sony and the latest Xbox console from Microsoft. Several semiconductor manufacturers, such as the American giant Qualcomm and its competitor AMD, are warning of a growing crisis.

The semiconductor supply chain is complex. The American giants, which supply manufacturers of consumer electronics, design the components but for the most part do not manufacture them. Asian subcontractors, such as Taiwan Semiconductor Manufacturing Company (TSMC) or South Korea’s Samsung, manage most of the production lines.

Manufacturers also have difficulty meeting demand from different sectors as a change in production mode can take them months.

Taiwan, home to some of the most modern semiconductor foundries, has found itself under pressure from automakers and governments. The island pledged last month to step up production of OEM chips, while TSMC said the automobile was “his highest priority», While noting that its factories were already operating at full capacity.

The launch of 5G has made matters worse, with a need for a large number of chips for a new generation of mobiles, wireless infrastructure and other equipment, said GlobalFoundries, a semiconductor manufacturer whose the headquarters are in the United States and the factories in Singapore.

At the heart of the global economy

Washington, which accuses Huawei, without having published any evidence, of having stolen American trade secrets, is blocking the supply of the Chinese giant of semiconductors made from American technology.

«When Huawei stockpiled smartphone chips, competitors also sought, to a lesser extent, to strengthen their reserves to guarantee their future supply.Exacerbating the global shortage, noted Neil Mawston of Strategy Analytics.

The lack of chips could delay production of nearly a million vehicles in the first quarter of this year, according to research firm IHS Markit. But analysts believe it is still too early to measure the impact on other sectors.

The deficit should be reduced during the year thanks to the vaccination campaigns which will allow the factories to return to a normal regime and new factories should also start.

But other shortages could occur in the future, analysts point out, calling for more local production in countries in demand.

«Semiconductors are at the heart of the global economy“Said GlobalFoundries in a press release, calling on governments to invest and”play their part to help bridge the clear mismatch between supply and demand» .

To see also – Apple presents its new iPhone 12, compatible with 5G

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