Ever since the initial lockdown in 2020, the hardware supply industry has struggled to keep up with the exponential demand. Intel’s CEO, Pat Gelsinger warns that the CPU chip shortage may last until 2023 due to soaring demand and pandemic pressure.
Why Has The Demand Increased So Much?
Intel’s chief financial officer, George Davis stated – “We remain in a highly constrained environment where we are unable to fully supply customer demand”. The huge increase in demand is primarily due to Intel struggling to obtain the materials, specifically the substrate to manufacture the chips. The group also stated that the demand is expected to grow, with supply shortages to continue for the next several quarters. However, Intel isn’t going to impose higher prices on their customers, as they want to continue building a strong relationship with their current and future customer base.
How Will This Affect Hardware Suppliers?
As hardware suppliers plan to maintain their customer demand, the chip shortages will cause issues and may potentially lead to losing customers. Intel isn’t the only hardware supplier that is facing issues however, companies such as EPYC and AMD are also facing the problems involved with the rising demand. We encourage our customers to plan ahead and get in touch regarding orders for next year, placing orders in advance to minimise extended lead times. Whilst we wait patiently for the manufacturers to get on top of the production once again, with each quarter of 2022 getting incrementally better.
Other Potential Hardware Shortages
Whilst CPU production from Intel and AMD is predominantly slow at the moment, other hardware equipment such as GPUs are facing the same issues. GPU supply has been hit just as hard, with ‘bots’ ordering the latest graphics cards for cryptocurrency mining, or to sell at inflated prices. Part of the supply issue is down to the huge increase in online shopping during the lockdowns in 2020, overloading orders on sites such as Amazon, eBuyer and eBay. 2020 was the single biggest year for PC demand in over a decade, adding pressure to hardware manufacturers whilst they were already behind due to their own supply issues for parts.
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