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Major Tech CEO Warns Chip Shortage Will Last Much Longer

   DailyWire.com
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Intel CEO Pat Gelsinger warned on Friday that the semiconductor shortage will last until 2024.

Certain manufacturing tools remain unavailable, which threatens to constrain chipmaking capacity, the executive told CNBC.

“That’s part of the reason that we believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged,” Gelsinger explained.

“We’ve really invested in those equipment relationships,” Gelsinger continued while discussing the diversification of chipmaking away from Asia, “but that will be tempering the build-out of capacity for us and everybody else, but we believe we’re positioned better than the rest of the industry.”

CNBC noted that Intel is investing heavily in semiconductor factories in the United States and Europe.

Many Asian economies introduced harsh lockdown measures in response to COVID-19, creating bottlenecks in the global semiconductor supply chain. Some automotive companies have been forced to limit or pause production due to the problem — worsening inflationary pressures as vehicle prices surge at the highest rate in decades.

Tesla, for instance, is not producing any new models in 2022. “The rate of growth will depend on our equipment capacity, operational efficiency and the capacity and stability of the supply chain,” Tesla said in a shareholder presentation announcing the company’s fourth-quarter 2021 earnings. “Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through 2022.”

In response, many companies are racing to erect new manufacturing facilities, even as local officials encourage production in their states.

For example, Samsung is building a $17 billion semiconductor factory in Taylor, Texas — marking the largest foreign direct investment in the state’s history.

“Companies like Samsung continue to invest in Texas because of our world-class business climate and exceptional workforce,” Governor Greg Abbott (R-TX) said last November in response. “Samsung’s new semiconductor manufacturing facility in Taylor will bring countless opportunities for hardworking Central Texans and their families and will play a major role in our state’s continued exceptionalism in the semiconductor industry.”

Meanwhile, Governor Ron DeSantis (R-FL) announced in January that he would invest the state’s funds to increase microchip and semiconductor manufacturing in Florida so that the Chinese Communist Party could not “hold our supply chain hostage.”

“We have to start standing up as Floridians and Americans,” DeSantis said at a press conference. “We cannot be captive. Key sectors of our economy should not be captive to some of these foreign nations, particularly outfits like the Communist Party of China.”

“And then even when you have allies like Taiwan, how that could impact, if there was a disruption there, could throw a lot of this through the loop even more than we’ve seen over the past year and a half,” he continued. “So the more we have this capacity within our own country, but particularly within our own state here in Florida, the more opportunities there’s going to be for people and the more secure both our economic supply chains will be and our national security.”

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