While the supply squeeze has been felt across the semiconductor industry, those display-bound integrated circuits pose specific challenges. Since they are not especially advanced, the circuits are typically made at chip factories that are several generations behind the cutting edge. With chipmakers focused on building more advanced fabrication plants that yield more valuable components, there has been little incentive to invest in capacity at older facilities. It’s simply not possible to churn out more of them even when demand spikes.
“Anything that has a screen built into it is going to be affected by these price increases.”
Paul Gagnon, Omdia
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Companies that act as electronics component brokers say that certain components have seen prices jump orders of magnitude; voltage regulators used in countless products that normally cost 50 cents have been selling for as much as $70. But at the consumer level, products that require display integrated circuits are feeling the impact first, and hardest, because of those factory limitations.
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The impacts have been felt beyond traditional consumer technology as well. Carmakers, in particular, were left flatfooted after expecting fewer sales. After preemptively canceling orders for semiconductor components, many auto manufacturers have
had to stop production while they wait for supply reinforcements to arrive. Broader supply chain disruptions have hurt as well, including a fire in March that shut down a plant in Japan that makes a range of different semiconductor components—including display integrated circuits.
