By Mark Lapedus for SEMICONDUCTOR ENGINEERING – Impact felt across many industries, including appliances, smart phones, cars, and industrial equipment.
The current wave of chip shortages is expected to last for the foreseeable future, particularly for a growing list of critical devices produced in mature process nodes.
Chips manufactured at mature nodes typically fall under the radar, but they are used in nearly every electronic device, including appliances, cars, computers, displays, industrial equipment, smartphones, and TVs. Many of these chips are hot and in tight supply with long lead times, while others are easy to find. It depends on the chip type, specification, and vendor.
In addition, some leading-edge chips, such as select memories and processors, are also in the same boat. Those chips tend to grab most of the attention, but the ones based on mature nodes are also important. Among the mature-node semiconductors in tight supply are CMOS image sensors, display driver ICs, flash memory controllers, microcontrollers (MCUs), power MOSFETs, and power management ICs (PMICs).
Chip shortages at trailing- and leading-edge nodes already have impacted a number of companies and their ability to ship products. Shortages have hampered shipments of cars, PCs, and smartphones, and the situation won’t improve anytime soon.
“Overall, we think the chip shortages will last at least until mid-next year,” said Samuel Wang, an analyst at Gartner.
It wasn’t always this way. In early-2020, IC vendors experienced a drop in demand amid the COVID-19 pandemic outbreak. By mid-2020, the market rebounded. The work/education-at-home economy drove demand for computers and TVs, which created a surge in demand for chips. Shortages for select chips appeared. That momentum then carried over into the first part of 2021 with some new dynamics at play. Acute chip shortages surfaced in automotive, and the situation has spilled over into smartphones and other products.
There are other reasons why the chip industry is seeing widespread chip shortages. At a high level, the industry is in the midst of a boom cycle, where demand is outstripping supply. And there is not enough chip manufacturing capacity to meet demand.
Leading-edge chips are manufactured in state-of-the-art 300mm fabs using various advanced processes ranging from 16nm/14nm to 5nm. In addition, 300mm fabs also manufacture devices at mature nodes ranging from 65nm to 28nm. Chips also are manufactured in older 200mm fabs using processes ranging from 350nm to 90nm.
For several years, worldwide 200mm fab capacity has been tight. The same is true for 300mm capacity. In fact, Taiwan foundries are sold out of capacity at least until mid-2022, analysts said.
“We are seeing unprecedented demand on many applications and across all nodes,” said Walter Ng, vice present of sales at UMC. “As this cycle continues to run a longer course, our belief is that this will likely be the new norm.”
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