The head of tech company Logitech has said that it’s likely that the production slowdowns, rising costs and logistical nightmares caused by the shortage of semiconductors could be over by the end of the year.
The optimistic forecast came courtesy of Bracken Darrell, chief executive at Logitech. In a first-quarter earnings call, he is quoted in a Yahoo report as saying that while “we are not over it”, in reference to the shortage, “the symptoms are getting milder”.
He continued to explain that “we will be free and clear in the third quarter, or in the worst case, the fourth quarter”. This would actually mean early 2023, rather than the end of 2022.
As you’re no doubt aware, the global shortages of semiconductors have hit a multitude of industries, from the automotive world all the way to consumer electronics and everything in between that uses electricity to work.
Nissan reported a record loss last year saying that the semiconductor shortage was primarily to blame, while JLR was forced to suspend production and Toyota reported a staggering 9 per cent drop in deliveries after not having enough to chips to keep up production.
Record high demand for semiconductors and dwindling supplies have even had Hyundai looking at ways to produce its own semiconductors.
The problem has been compounded by the fact that semiconductor production is a labour-intensive, expensive and extremely slow process.
The industry average to produce and engrave a single wafer of chips from raw silicon is around 13 weeks, which is made more problematic by the fact that they can be easily contaminated during the manufacturing process.
We’ll have to wait and see how the claims made by Logitech’s chief play out in the wider market, but we can at least be optimistic by his comments.
