How serious is the lack of core? ASML CEO revealed: Some companies bought washing machines to remove chips

Abstract: What is the point where the shortage of chips in the market has become? An exaggerated scenario is playing out in reality: due to the shortage of chips, a manufacturing company has begun to buy washing machines in large quantities and then remove the chips inside to use.

What is the shortage of chips in the market? An exaggerated scenario is playing out in reality: due to the shortage of chips, a manufacturing company has begun to buy washing machines in large quantities and then remove the chips inside to use.

The incident was revealed by Peter Wennink, CEO of ASML, a lithography machine giant in the chip industry. He talked about the situation in the company's earnings report on Wednesday, saying that a large industrial group has begun to buy washing machines and remove the semiconductors in them for its own chip modules.

Mr. Wennink did not name which company, saying only that it had revealed its predicament to him only the week before. This situation clearly vividly shows the current severity of the chip shortage in some industries, and hints that this "serious chip shortage" will continue for the foreseeable future.

In addition, Winningk also revealed that a major Chinese chipmaker has sold out its full capacity by the end of 2023.

"The demand we're seeing right now is coming from a lot of parts of the industry," Wenninke said, referring to the widespread use of the Internet of Things, "which is so broad." We grossly underestimate the breadth of demand. I don't think this will go away. ”

Chip production capacity is difficult to increase in the short term

The current shortage of chips and components is so that even chip equipment manufacturers themselves struggle to obtain enough chips and components to complete orders, which means that it is becoming more difficult for the global semiconductor industry to significantly increase production capacity in the short term.

Tim Archer, CEO of Colin R&D, a U.S.-based supplier of semiconductor etching machines, said on Wednesday's earnings call: "On the demand side, the overall environment remains very strong, and continued supply-related delays may limit how much wafer equipment investment can actually land in 2022." ”

In an earnings call last Thursday, TSMC CEO Wei Zhejia highlighted the challenges facing its suppliers. He said labor and chip constraints have led to longer delivery times, and its capacity remains tight throughout 2022.

According to research by Susquehanna Financial Group, the waiting cycle for semiconductor deliveries rose slightly in March, reaching a new high of 3.26 weeks.

Toyota this week cut its production target for this year by about 10,<> vehicles due to insufficient semiconductor supply. Tesla also said this week that its production is still affected by chip shortages and price increases for key components, while Volkswagen warned that the negative impact of the lack of chips may continue.