There is a good article on Yahoo News today about causes of the semiconductor shortage.
Here is a little of the gist of it.
Many factors conspired to cause the semiconductor shortage that’s constraining the production of cars and many other products. The coronavirus pandemic massively disrupted supply chains. Remote workers stocked up on chip heavy computers and other gizmos. Same with bored consumers doing more streaming and gaming. Fires at two Japanese chip plants cut into supply. Then a surprisingly strong recovery produced demand far more robust than manufacturers expected.
In 2018, as part of the trade war with China, the USA imposed 25% tariffs on $34 billion worth of Chinese imports, including semiconductors—the first of several salvos in the trade war with China. Those tariffs are still in effect, and chip imports from China have fallen by half as the price has gone up
China now accounts for only about 5% of imported semiconductors, according to research firm Panjiva. But imports from other countries have not gone up to offset the lost supply from China. A 5% contraction in supply during a shortage can have outsized effects.
In 2019, the USA banned the sale of American-made components, including semiconductors, to the Chinese telecom giant Huawei, in an effort to disenfranchise the maker of networking gear and smartphones. That had several undesirable consequences. For one, it created a disincentive to make chips in the United States because producers couldn’t sell them to one of the world’s largest customers. Huawei begin to get chips from suppliers in Japan and South Korea that weren’t subject to the ban. China also boosted its own production of chips, and it began hoarding them, in case the U.S. action intensified. The U.S. semiconductor industry says the actions cost U.S. firms millions in sales
The trade actions were meant to address legitimate Chinese abuses. But this unilateral approach left China many escape hatches while causing substantial collateral damage. The fiasco contributed to the current shortages, hurting American businesses and workers
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jaybmiller wrote:
