The global shortage of computer chips is continuing to affect more than 100 industries.
Everyone from smartphone manufacturers to games console makers and the automobile industry has been hit by supply issues.
Consulting firm AlixPartners has suggested the automobile industry alone stands to lose $210 billion in revenue as a result of the shortage.
But why is this happening and when could it end? Here is everything you need to know.
Why is there a computer chip shortage?
The shortage can be put almost entirely down to the Covid-19 pandemic.
Restrictions have forced more people globally to work from home. This caused a spike in computer sales – an 11 per cent rise on 2019 – and therefore increased demand for chips.
As demand grew, supply dried up. Factories were forced to run at reduced capacity due to social distancing rules.
Dr. Suresh Venkatesan, CEO of POET Technologies, which develops photonics and optoelectronics for the data centre and telecommunications markets, told Forbes: “What we did with those laptops also contributed to the slowdown. More people have routers and broadband and are using more data for Zoom calls, FaceTime chats or streaming all kinds of entertainment.
“That all leads to a disruption in supply and an increase in use, resulting in depleted inventory across the industry.”
He added: “In over three decades in the semiconductor and optoelectronics industry, I have never seen supply fall so far short of meeting demand.”
When will the chip shortage end?
Compute chip manufacturers are now starting to ramp up production and even up their manufacturing capacity to try to make up for the shortfall.
However, advanced chips can take as long as 20 weeks to complete, which means we may not start to feel the effects of this production drive until well into 2022.
Mr Venkatesen said: “I believe there are indications that the world will return to a stronger, better-prepared new normal in 2022. Soon enough, we’ll be reaching manufacturing targets at such dizzying levels it will seem like we are indeed propelling at light speed.”