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MacroFab Blog

Avoiding Electronics Supply Chain Delays in Q1

Published on January 27, 2021
Written by The MacroFab Team
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Remember the wildly unpredictable lead times for electronics a few years ago due to component shortages? Buckle up: supply chain delays are brewing. We may be heading back to the future: 2021 is starting to look a lot like 2018.

Only obscure supply chain blogs covered this last year, but even NPR is now leading with stories about electronics delays in the auto industry now. More pain is on the way. Here’s a roundup of the latest supply chain developments along with some commentary on how it may affect your electronics production.

The main culprit is Covid-19, but not in a way you may expect. As one semiconductor executive put it – a lot of customers pulled back their demand forecasts in Q2 of last year, but the slowdown never happened and everyone resumed buying at normal levels in Q3, depleting stock just as many factories were slowing down production based on lower forecasts.

Proactively Plan for Supply Chain Delays

What does it have to do with 2021? Well. Electronics supply chain is like a rubber - band, snapping in slow motion. A sharply lower demand forecast results in lower supply several quarters in the future, just as everyone is scrambling to get their hands-on materials.

What does it all mean for you? Be mindful of lead times and plan your production well in advance. Even if you’re only building prototypes, it’s worth your time to check on supply chain availability, otherwise, your product may be delayed.

  • 8-inch wafer delays are causing problems for a wide range of semiconductor components. 85% of MOSFETS use 8-inch wafers, not to mention CPU, GPU, power management IC and logic IC manufacturers are all affected. Expect delays for insulated gate bipolar transistors (IGBTs), chip resistors, sensors, microcontrollers.

  • Renesas, Richtek, NXP, Infineon lead times have been running long, affecting parts used in IoT, PC, and automotive industries.

  • Prices and lead times for capacitors are going up. MLCC capacitors are up 3-4% driven by a surge in automotive demand and an unfortunate factory fire, with tantalum capacitors going up even higher. Some vendors like AVX are experiencing shortages and will continue to see delays into the Summer of 2021.

  • GPUs, DRAM, Intel Bluetooth modules, and finished LCDs are all experiencing higher prices (anywhere from 15%-70%) and longer lead times due to demand from the automotive and 5G industries. Desktop products have seen a surge in demand because of home workers, compounding the problem.

  • Another unexpected price vector in 2021: price increases driven by tariffs. Trump tariffs are not expected to be repealed by President Biden any time soon, but some of the exclusions granted by the Trump administrationareexpiring. 2-layer and 4-layer PCBs are expected to go up in price for this reason, but only if they are sourced from China.

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