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IBM Boss Says There’s No End in Sight to Chip Shortage

IBM’s president, Jim Whitehurst, is the latest high-profile figure to weigh in on the chip shortage currently plaguing industries across the globe. During an interview with the BBC, he said the shortage could last “a couple more years.”

“There’s just a big lag between from when a technology is developed and when [a manufacturing plant] goes into construction and when chips come out,” he explained. “So frankly, we are looking at couple of years… before we get enough incremental capacity online to alleviate all aspects of the chip shortage.”

The shortage has severely disrupted production across many industries. Apple, the world’s largest user of semiconductors, was forced to move up the release date of its latest iPhone.

The auto industry is one of the worst affected, with a $110 billion loss in industry revenue expected from the shortage this year. The loss in the auto industry is turning out much worse than previously thought – it was initially pegged at $60 billion in January, during the early days of the shortage.

Plants were totally shutdown for several weeks during the pandemic. When they reopened, they were faced with unprecedented levels of demand not only due to supply backlogs but also surging demands for consumer electronics like TVs, phones, and gaming consoles, as people are spend more time indoors. To boot, recent problems like a fire at a plant near Tokyo and weather-related challenges (like the crippling frosts in Texas) have exacerbated the shortage.

However, Whitehurst isn’t waiting around for several new plants to be commissioned. Like other industry chiefs, he’s looking for other alternative ways to meet production targets.

“We’re going to have to look at reusing, extending the life of certain types of computing technologies, as well as accelerating investment in these [fabricating plants], to be able to as quickly as possible get more capacity online,” he said.

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