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Electronic Components

Electronic Components of a hearing aid

Hearing aids are an essential device that can help those with hearing loss to experience sound. The gadget comes in an analogue or digital format, with both using electronic components to amplify sound for the user.

Main components

Both types of hearing aid, analogue and digital, contain semiconductors for the conversion of sound waves to a different medium, and then back to amplified sound waves.

The main components of a hearing aid are the battery, microphone, amplifier, receiver, and digital signal processor or mini-chip.

The battery, unsurprisingly, is the power source of the device. Depending on the type of hearing aid it can be a disposable one or a rechargeable one.

The microphone can be directional, which means it can only pick up sound from a certain direction, which is in front of the hearing aid user. The alternative, omnidirectional microphones, can detect sound coming from all angles.

The amplifier receives signals from the microphone and amplifies it to different levels depending on the user’s hearing.

The receiver gets signals from the amplifier and converts them back into sound signals.

The digital signal processor, also called a mini-chip, is what’s responsible for all of the processes within the hearing aid. The heart of your hearing, if you will.

Chip shortages

As with all industries, hearing aids were affected by the chip shortages caused by the pandemic and increased demand for chips.

US manufacturers were also negatively impacted by Storm Ida in 2021, and other manufacturers globally reported that orders would take longer to fulfil than in previous years.

However, despite the obstacles the hearing aid industry faced thanks to covid, it has done a remarkable job of recovering compared to some industries, which are still struggling to meet demand even now.

Digital hearing aid advantages

As technology has improved over the years, traditional analogue hearing aids have slowly been replaced by digital versions. Analogue devices would convert the sound waves into electrical signals,  that would then be amplified and transmitted to the user. This type of hearing aid, while great for its time, was not the most authentic hearing experience for its users.

The newer digital hearing aid instead converts the signals into numerical codes before amplifying them to different levels and to different pitches depending on the information attached to the numerical signals.

Digital aids can be adjusted more closely to a user’s needs, too, because there is more flexibility within the components within. They often have Bluetooth capabilities too, being able to connect to phones and TVs. There will, however, be an additional cost that comes with the increased complexity and range of abilities.

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Electronic Components

What are GaN and SiC?

Silicon will eventually go out of fashion, and companies are currently heavily investing in finding its protégé. Gallium Nitride (GaN) and Silicon Carbide (SiC) are two semiconductors that are marked as being possible replacements.

Compound semiconductors

Both materials contain more than one element, so they are given the name compound semiconductors. They are also both wide bandgap semiconductors, which means they are more durable and capable of higher performance than their predecessor Silicon (Si).

Could they replace Silicon?

SiC and GaN both have some properties that are superior to Si, and they’re more durable when it comes to higher voltages.

The bandgap of GaN is 3.2eV and SiC has a bandgap of 3.4eV, compared to Si which has a bandgap of only 1.1eV. This gives the two compounds an advantage but would be a downside when it comes to lower voltages.

Again, both GaN and SiC have a greater breakdown field strength than the current semiconductor staple, ten times better than Si. Electron mobility of the two materials, however, is drastically different from each other and from Silicon.

Main advantages of GaN

GaN can be grown by spraying a gaseous raw material onto a substrate, and one such substrate is silicon. This bypasses the need for any specialist manufacturing equipment being produced as the technology is already in place to produce Si.

The electron mobility of GaN is higher than both SiC and Si and can be manufactured at a lower cost than Si, and so produces transistors and integrated circuits with a faster switching speed and lower resistance.

There is always a downside, though, and GaN’s is the low thermal conductivity. GaN can only reach around 60% of SiC’s thermal conductivity which, although still excellent, could end up being a problem for designers.

Is SiC better?

As we’ve just mentioned, SiC has a higher thermal conductivity than its counterpart, which means it would outlast GaN at a higher heat.

SiC also has more versatility than GaN in what type of semiconductor it can become. The doping of SiC can be performed with phosphorous or nitrogen for an N-type semiconductor, or aluminium for a P-type semiconductor.

SiC is considered to be superior in terms of material quality progress, and the wafers have been produced to a bigger size than that of GaN. SiC on SiC wafers beat GaN on SiC wafers in terms of cost too.

SiC is mainly used for Schottky diodes and FET or MOSFET transistors to make converters, inverters, power supplies, battery chargers and motor control systems.

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Electronic Components

Semiconductors in space

Blast off

A post about semiconductors being used in space travel would be the perfect place to make dozens of space-themed puns, but let’s stay down to earth on this one.

There are around 2,000 chips used in the manufacture of a single electric vehicle. Imagine, then, how many chips might be used in the International Space Station or a rocket.

Despite the recent decline in the space semiconductor market, it’s looking likely that in the next period there will be a significant increase in profit.

What effect did the pandemic have?

The industry was not exempt from the impact of the shortage and supply chain issues caused by covid. Sales decreased and demand fell by 14.5% in 2020, compared to the year-on-year growth in the years previous.

Due to the shortages, many companies within the industry delayed launches and there was markedly less investment and progress in research and development. However, two years on, the scheduled dates for those postponed launches are fast approaching.

The decline in investment and profit is consequently expected to increase in the next five years. The market is estimated to jump from $2.10 billion in 2021 all the way up to $3.34 billion in 2028. This is a compound annual growth rate (CAGR) of 6.89%.

What is being tested for the future

In the hopes of ever improving the circuitry of spaceships there are several different newer technologies currently being tested for use in space travel.

Some component options are actually already being tested onboard spacecrafts, both to emulate conditions and to take advantage of the huge vacuum that is outer space. The low-pressure conditions can emulate a clean room, with less risk of particles contaminating the components being manufactured.

Graphene is one of the materials being considered for future space semiconductors. The one-atom-thick semiconductor is being tested by a team of students and companies to see how it reacts to the effects of space. The experiments are taking place with a view to the material possibly being used to improve the accuracy of sensors in the future.

Two teams from the National Aeronautics and Space Administration (NASA) are currently looking at the use of Gallium Nitride (GaN) in space too. This, and other wide bandgap semiconductors show promise due to their performance in high temperatures and at high levels of radiation. They also have the potential to be smaller and more lightweight than their silicon predecessors.

GaN on Silicon Carbide (GaN on SiC) is also being researched as a technology for amplifiers that allows satellites to transmit at high radio frequency from Earth. Funnily enough, it’s actually easier to make this material in space, since the ‘clean room’ vacuum effect makes the process of epitaxy – depositing a crystal substrate on top of another substrate – much more straightforward.

To infinity and beyond!

With the global market looking up for the next five years, there will be a high chance of progress in the development of space-specialised electronic components. With so many possible advancements in the industry, it’s highly likely it won’t be long before we see pioneering tech in space.

To bring us back down to Earth, if you’re looking for electronic components contact Lantek today to see what they can do for you. Email us at sales@lantekcorp.com or use the rapid enquiry form on our website.

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Electronic Components

The History of Transistors

The History of Transistors

Transistors are a vital, ubiquitous electronic component. Their main function is to switch or amplify the electrical current in a circuit, and a modern device like a smartphone can contain between 2 and 4 billion transistors.

So that’s some modern context, but have you ever wondered when the transistor was invented? Or what it looked like?

Pre-transistor technology

Going way back to when Ohm’s Law was first discovered in 1820s, people had been aware of circuits and the flow of current. As an extension of this, there was an awareness of conductors.

Following on from this, semiconductors accompanied the birth of the AC-DC (alternating current – direct current) conversion device, the rectifier, in 1874.

Two patents were filed in the 20s and 30s for devices that would have been transistors if they had ever reached past the theoretical stage. In 1925 Julius Lilienfeld of Austria-Hungary filed a patent, but did not end up releasing any papers regarding his research on the field-effect transistor, and so his discoveries were ignored.

Again, in 1934 German physicist Oskar Heil’s patent was on a device that, by applying an electrical field, could control the current in a circuit. With only theoretical ideas, this also did not become the first field effect transistor.

The invention of transistors

The official invention of a working transistor was in 1947, and the device was announced a year later in 1948. The inventors were three physicists working at Bell Telephone Laboratories in New Jersey, USA. William Shockley, John Bardeen and Walter Brattain were part of a semiconductor research subgroup working out of the labs.

One of the first attempts they made at a transistor was Shockley’s semiconductor triode, which was made up of three electrodes, an emitter, a collector and a large low-resistance contact placed on a block of germanium. However, the semiconductor surface trapped electrons, which blocked the main channel from the effect of the external field.

Despite this initial idea not working out, the issue was solved in 1946. After spending some time looking into three-layer structures featuring a reversed and forward-biased junction, they returned to their project on field-effect devices in a year later in 1947. At the end of that year, they found that with two very close contact junctions, with one forward biased and one reverse biased, there would be a slight gain.

The first working transistor featured a strip of gold over a triangle of plastic, finely cut with a razor at the tip to create two contact points with a hair’s breadth between them and placed on top of a block of germanium.

The device was announced in June of 1948 as the transistor – a mix of the words ‘transconductance’, ‘transfer’ and ‘varistor’.

The French connection

At the same time over the water in France, two German physicists working for Compagnie des Freins et Signaux were at a similar stage in the development of a point contact device, which they went on to call the ‘transistron’ when it was released.  

Herbert Mataré and Heinrich Welker released the transistron a few months after the Bell Labs transistor was announced but was engineered completely without influence by their American counterpart due to the secrecy around the Bell project.

Where we are now

The first germanium transistors were used in computers as a replacement for their predecessor vacuum tubes, and transistor car radios were produced all within only six years of its invention.

The first transistor was made with germanium, but since the material can’t withstand heats of more than 180˚F (82.2˚C), in 1954 Bell Labs switched to silicon. Later that year Texas Instruments began mass-producing silicon transistors.

First silicon transistor made in 1954 by Bell Labs, then Texas Instruments made first commercial mass produced silicon transistor the same year. Six years later in 1960 the first in the direct bloodline of modern transistors was made, again by Bell Labs – the metal-oxide-semiconductor field-effect Transistor (MOSFET).

Between then and now, most transistor technology has been based on the MOSFET, with the size shrinking from 40 micrometres when they were first invented, to the current average being about 14 nanometres.

The latest in transistor technology is called the RibbonFET. The technology was announced by Intel in 2021, and is a transistor whose gate surrounds the channel. The tech is due to come into use in 2024 when Intel change from nanometres to, the even smaller measuring unit, Angstrom.

There is also other tech that is being developed as the years march on, including research into the use of 2D materials like graphene.

If you’re looking for electronic components, Lantek are here to help. Contact us at sales@Lantekcorp.com to order hard-to-find or obsolete electronic components. You can also use the rapid enquiry form on our website https://www.cyclops-electronics.com/

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Electronic Components

Latest electronic component factory openings

We’ve all heard about the shortages in standard components like semiconductors and chips. Cars, phones and computers, items we use every day, are no longer being produced at the speedy rate we’ve come to expect. The cause of this shortage is, in part, due to the COVID-19 pandemic.

To combat this shortage many electronic component manufacturers have announced the opening or development of new factories. This is especially noticeable in Europe and America, where production has often been outsourced to Asia in the past.

So who are the latest companies expanding operations, and how much are they spending? Check out our quick run-down of factories and when they should open:

Company: Intel

Location: Ohio, USA

Product: Chips

Completion date: 2025

Cost: $20 billion (£14.7 billion)

The latest, and possibly greatest, announcement on our list comes from Intel. The corporation revealed in January that they would be committing to building two chip manufacturing plants in New Albany, Ohio. The move is said to be due to supply chain issues with Intel’s manufacturers in Asia, and should boost the American industry with the creation of at least 3,000 jobs. Construction should begin this year.

Company: Samsung Electronics

Location: Texas, USA

Product: Semiconductors

Completion date: 2024

Cost: $17billion (£12.5billion)

The household name announced late last year that they would begin work on a new semiconductor-manufacturing plant in Taylor, Texas. The Korean company stated the project was Samsung’s largest single investment in America, and is due to be operational by the middle of 2024.

Company: Infineon

Location: Villach, Austria

Product: Chips

Completion date: 2021

Cost: 1.6 billion (£1.3 billion)

After being in construction since 2018, Infineon’s Austrian plant became operational in September last year. The chip factory for power electronics, also called energy-saving chips, on 300-millimeter tin wafers began shipping three months ahead of schedule in 2021, and its main customer base will be in the automotive industry.

Company: Northvolt

Location: Gdańsk, Poland

Product: Batteries

Completion date: 2022

Cost: $200 million (£148 million)

The Swedish battery manufacturer is expanding its operations with a new factory in Poland. While initial operations are supposed to begin this year producing 5 GWh of batteries, it hopes to further develop to produce 12 GWh in future. Northvolt has also just begun operations at its new battery factory in Skellefteå in Sweden.

Company: Vingroup

Location: Hà Tĩnh, Vietnam

Product: Batteries

Completion date: 2022

Cost: $174 million (£128 million)

The Vietnamese electric vehicle manufacturer is due to start production at its new factory later this year, where it will produce lithium batteries for its electric cars and buses. The factory will be designed to produce 10,000 battery packs per year initially, but in a second phase the manufacturer said it will upgrade to 1 million battery packs annually. VinFast, a member of Vingroup, is also planning on expanding operations to America and Germany.

Company: EMD Electronics

Location: Arizona, USA

Product: Gas and chemical delivery systems

Completion date: 2022

Cost: $28 million (£20.7 million)

The member of the multinational Merck Group is expanding operations with the construction of a new factory in Phoenix, Arizona, to manufacture equipment for its Delivery Systems & Services business. The factory is due to be operational by the end of the year, and will produce GASGUARD and CHEMGUARD systems for the company.

A bright future

These electronic component factory openings signal a great increase in business, and will aide in the easing of the component crisis. But it will take a while for these fabs to be operational.

Can’t wait? Lantek is there for all your electronic component needs. We have 30 years of expertise, and can help you where other suppliers cannot. Whether it’s day-to-day or obsolete electronic components, contact us today at sales@lantekcorp.com, or use the rapid enquiry form on our website.

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Electronic Components

Electronic component market to see continued growth by 2027

Electronic component market to see continued growth by 2027

The electronic component market is set to see continued growth over the next five years, with projections estimating greater demand than ever.

Several forecasts have converged with the same conclusion; demand for components is set to rocket as the world adopts more advanced technologies. 

This article will explore the latest research papers and market analysis from reputable sources. We will also explore why the demand for electronic components is set to soar and the supply chain’s challenges. 

Global components market 

The market analysis covered by Market Watch predicts that the global electronic components market will reach USD 600.31 billion by 2027, from USD 400.51 billion in 2020, a compound annual growth rate of 4.7% from 2021. 

Active components market 

Another market report, this time looking at active electronic components, predicts the active electronic components market will reach USD 519 billion by 2027 (£380bn pounds, converted 12/01/22), a CAGR of 4.82% from 2021. 

Passive and interconnecting components market 

According to 360 Research Reports, the passive and interconnecting electronic components market is projected to reach USD 35.89 billion in 2027, up from USD 28.79 billion in 2020, a compound annual growth rate of 3.2% from 2021. 

Semiconductor wafer market 

According to Research and Markets, the global semiconductor wafer market is predicted to reach USD 22.03 billion by 2027, rising at a market growth of 4.6% CAGR during the forecast period starting from 2021. 

Dynamic Random Access Memory (DRAM) market

Market Reports World predicts the global DRAM market will see extreme growth, growing at a CAGR of 9.86% between 2021 and 2027. The market was valued at USD 636.53 million in 2021 and will grow to nearly USD 700 million by 2027.  

Why is component demand set to increase so much?

The world is undergoing an extreme technological transformation that began with the first computers. Today, electronics are everywhere, and they are becoming ever more intricate and complex, requiring more and more components. 

Several technologies are converging, including semi-autonomous and electric vehicles, automation and robotics, 5G and internet upgrades, consumer electronics, and smart home appliances like EV chargers and hubs. 

This is a global transformation, from your house to the edge of the earth. Electronic components are seeing unprecedented demand because smarter, more capable devices are required to power the future. 

What challenges does the supply chain face? 

The two biggest challenges are shortages and obsolescence. 

Shortages are already impacting supply chains, with shortages of semiconductors, memory, actives, passives, and interconnecting components. 

As demand increases, supply will struggle to keep up. It will be the job of electronic components suppliers like Lantek and electronic component manufacturers to keep supply chains moving while demanding increases. 

Obsolescence refers to electronic components becoming obsolete. While some electronic components have lifespans of decades, others are replaced within a few years, which puts pressure on the supply chain from top to bottom. Email your inquiries to us today at sales@lantekcorp.com. Our specialized team is here to help.

In any case, the future is exciting, and the electronic components market will tick along as it always does. We’ll be here to keep oiling the machine. 

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component shortage Electronic Components

Causes of IC Shortage

There’s a serious shortage of integrated circuits affecting every corner of the electronics’ world. Discrete circuits, optoelectronics and sensors are also experiencing shortages, putting pressure on supply chains from top to bottom.

What are the causes of IC shortages? This article will explore the main causes, so that you can understand what’s going on.

Reshaped demand

The Coronavirus pandemic reshaped demand for semiconductors, shifting automotive demand to device demand (car plants shut down, while demand for electronic devices soared with stay at home and remote working).

Now that automotive production is ramping back up, there aren’t enough ICs to go around, causing a shortage across all industry sectors.

The pandemic also caused short-term, unplanned plant shutdowns and labor shortages, reducing the number of ICs manufactured.

Logistics

The logistics industry is still recovering from COVID-induced shutdowns and travel restrictions. While air and sea freight is running at good capacity, road transport is proving difficult across borders, creating supply constraints.

In 2020, air cargo capacity saw a 20% decline. In 2021, it’s back to normal, but you still have the problem of moving components on the ground.

In the USA, there is also a serious driver shortage underway that is affecting everything from electronic components to supermarket shelves.

Lead times

The amount of time that passes between ordering semiconductors and taking delivery has increased to record levels. In July 2021, it surpassed 20 weeks, the highest wait time since the start of the year and eight days longer than June.

Longer lead times can be caused by a variety of factors, but in this case it’s caused by factories running at capacity with no room for acceleration. Labor shortages and problems getting hold of materials are exasperating the problem.

Raw materials

A shortage of raw materials is causing big problems for semiconductor manufacturers, who can’t get the materials they need to meet demand. Shortages of raw materials and high raw material prices are combining to squeeze production.

The soaring price of raw materials is also increasing the prices of ICs, with some components seeing a yearly price increase up to 40%. These costs will eventually be passed on to the consumer who will have to stomach higher prices.

Stockpiling

Whether we’re talking about the communications, automotive or consumer electronics sector, IC stockpiling has exploded. The world’s biggest manufacturers have stockpiled huge quantities of components for themselves.

This hoarding of components by nervous manufacturers eager to secure inventory takes a significant volume of components off the open market, squeezes the supply chain, and gives the biggest players an upper hand over everyone else.   

Trade sanctions

For all their bad press, China makes a lot of chips – around a billion a day. Their biggest chipmaker, SMIC, was hit by US sanctions in late 2020, eliminating SMIC chips from the US market. You’d think this would mean more chips for the rest of the world, but China recoiled and went defensive, keeping most of the chips for themselves.

US sanctions twisted the global supply chain out of shape, creating volatility in an industry that was already in turmoil from the pandemic.

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component shortage Electronic Components

Component Prices Rise 10% to 40% – But why?

While component price increases are expected when demand surpasses supply, the scale of recent increases has come as a shock to many businesses.

In its Q3 Commodity Intelligence Quarterly, CMarket intelligence platform Supplyframe reports that some electronic components have seen prices rise by as much as 40%, making it uneconomical for products to be made.  

Specifically, semiconductors, memory and modems are seeing 10 to 40% price increases, exceeding what most analysts envisioned for 2021.

Why are prices rising?

Price rises start with materials. There are long lead times for many raw materials, causing shortages. Add rising commodity prices and difficulties transporting products and you have a disrupted manufacturing economy.

You also must factor in the impact of the coronavirus pandemic, which has caused labor shortages and disrupted the manufacturing economy with shutdowns.

Logistics is also a big fly in the ointment for electronic components. The industry is recovering from COVID-induced shutdowns and travel restrictions are causing problems at borders, creating delays that ripple through the supply chain.

Supply and demand

The bulletproof economics of supply and demand also rule the roost for electronic components, and demand is higher than it has ever been.

We are in a situation today where most electronic components manufacturers are running at 99-100% capacity and can’t keep up with demand.

Demand is outstripping supply for chips, memory and communications components like integrated circuits, discrete circuits, optoelectronics, and sensors creating a bidding war as manufacturers scramble to get what they need.

Growing demand for new technologies

Emerging technologies like artificial intelligence, machine learning, virtual reality, augmented reality, and edge computing are fuelling demand for smarter chips and data center modernization, while technologies like 5G and Wi-Fi 6 are demanding infrastructure rollout, which requires significant investment.

Across the board, technology is booming. Manufacturers are making more products for more people, and they must do so while balancing costs at a time when component prices are rising – no easy feat even for established businesses. 

Pressure relief

Everyone is raising prices in line with their own cost increases, from semiconductor manufacturers to outsourced fabs and suppliers. At 10 to 40%, these increases are putting pressure on supply chains and businesses.

How many price increases will target markets absorb? How can we sustain production without significant margin pressure? These are the challenges facing manufacturers, who are stuck between a rock and a hard place right now.

There are a few solutions:

  • Equivalents: Source equivalent components from different brands/makers/OEMs that meet size, power, specification, and design standards.
  • Use an electronic components distributor: Distributors are the best-connected players in the industry, able to source hard-to-procure and shortage components thanks to relationships with critical decision makers.

Prices will fizzle down, eventually

Although research published by Supplyframe says pricing challenges will remain through early 2023, they won’t last forever. Price rises should fizzle out towards the end of 2021 as manufacturers catch up to orders and reduce disruption.

If you are experiencing an electronic component shortage, we can help. Email us at sales@lantekcorp.com if you have any questions or call us at 973-579-8100 to talk with our team.

 

 

 

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Electronic Components Semiconductor

Why are semiconductors so important to so many industries?

The semiconductor chip has done more to connect the world than any other technology, but why is it so important to so many industries?  

Semiconductors are materials used to make semiconductor wafers. Which potentially millions of components are fabricated, to create an integrated circuit (IC), creating a single chip that can be used for computation or other tasks.

Semiconductors are important to so many industries because they are an essential electronic component. Whether we are talking about the semiconductor material (silicon, silicon carbide) or the chips that perform tasks.  

To understand why semiconductors are so important to so many industries, let’s take a step back and clarify what a semiconductor actually is.

What is a semiconductor?

A semiconductor is a material that partly conducts current, somewhere between that of an insulator and a conductor (hence the name semi-conductor).

A semiconductor chip is an integrated circuit (IC) formed on a wafer of silicon, consisting of the semiconductor material that manages the flow and control of current, and components like transistors and resistors to create the circuit.

When talking about semiconductors in relation to chips, we use the names “chips” or “semis’” because these names are more accurate for describing circuits laid down or grown to do computation or other tasks like memory.

Why are semiconductors so important?

In 1947, the first semiconductor transistor was made. Engineers quickly realized that manufacturing transistors out of silicon allowed them to fit on a microchip, which opened the gates to all the electronics you use today.

Without semiconductor chips, modern electronics would not exist. These inconspicuous, tiny components replaced tubes in electronics in the 1970s, laying the foundation for every electrical device used today, including the screen you’re looking at.

Today, all modern electrical devices use semiconductor chips, from home ovens to smartphones and cars. Billions of semiconductors are manufactured each year, and they are getting smaller and smarter with each generation.

Powering our smart, connected world

As we discussed earlier, semiconductor chips are single electronic components consisting of thousands or millions of electrical components, enabling functions like computation, memory, oscillation, switching, logic, amplification, and so on.

Without this single component with an integrated circuit, there would be no way to efficiently make the circuits we need to create smart, connected devices in their current form. Quite literally, chips are the reason you are reading this.

With an insatiable appetite for semiconductor chips, it’s a good job the material we use to make the wafers – silicon – is naturally abundant.

Today, most chips are built on silicon, which makes up 27.7% of the earth’s crust, or silicon carbide, a compound tweaked for performance.

However, our demand for chips is outstripping supply. There is a global semiconductor shortage underway affecting all industries, with the automotive industry hardest hit due to a perfect storm that has been building for years.

Electronic components distributors like Lantek are helping supply meet demand, while the semiconductor industry battles to make more chips.

If you are having difficulty finding those hard-to-find and obsolete electronic components. Get in touch with our team today by emailing sales@lantekcorp.com or call 1-973-579-8100

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Electronic Components

Chips shortage limits auto production in Brazil and the rest of the world

“Never seen anything like it,” Tesla’s Elon Musk tweeted last month about the global chips shortage, “Fear of running out is causing every company to overorder – like the toilet paper shortage, but at epic scale.”

If you want a prime example of the chips shortage, look to Brazil.

In 2020, the automotive industry in Brazil was hit hard by chip shortages and the coronavirus pandemic. Approximately 1.61 million passenger cars were made in 2020, a decrease of over 34% compared to the following year. 

2021 got off to a flier… then grounded

2021 got off to a much better start for Brazil, with 1.14 million passenger cars leaving the production line in in the first half of the year, a 57.5% increase compared to the same period last year. However, production has hit a ceiling.

Brazil’s Association of Automotive Vehicle Manufacturers, ANFAVEA, has disclosed that because of chip shortages, Brazil missed its target for automotive production in the first half of 2021, and the numbers cited are startling.

According to ANFAVEA, some 100,000 to 120,000 passenger cars were prevented from entering production by the chips shortage. In June, only 166,947 passenger cars were made, the worst figures of any month in the last 12 months.

Manufacturing limitations created by the chips shortage have been compounded by the coronavirus pandemic. Brazil has seen 19.8m coronavirus cases with a 2.8% mortality rate, sadly resulting in over 500,000 deaths.

The biggest factories are struggling in Brazil

More than 20 plants in Brazil run by the likes of Volkswagen, Mercedes-Benz, General Motors, Nissan, Toyota, Renault, Volvo, Scania and Honda have shut down temporarily in 2021 because of the chips shortage and the pandemic.

At the beginning of June, Volkswagen halted operations at two Brazilian plants amid the chips shortage for 10 days. The company said, “A significant shortage of semiconductors is resulting in several supply bottlenecks.”

Then, in July, Hyundai Motor temporarily halted the operations of its Brazil plant due to the chips shortage. The closure was the first in the Piracicaba plant’s history, raising the alarm over chip shortages in the automotive sector.

What next for the Brazilian automotive sector?

Figures show that in the first half of 2021, the Brazilian automotive sector had a strong rebound on 2020. However, water has been thrown over the fire towards the middle of the year, due to chip shortages across the sector.

Local manufacturers expect to see some relief after August as manufacturing plants catch up, but manufacturers are uncertain about when the supply chain will normalize.

How’s morale among big companies? Sombre, to say the least.  

IBM says the chip shortage could last two years, while Intel Intel’s chief executive, Pat Gelsinger, thinks it could stretch into 2023.

Dell’s CEO echoes these sentiments, “The shortage will probably continue for a few years. Even if chip factories are built all over the world, it takes time.”

So, whichever way we look, and whichever experts we ask, the global chip shortage is showing no signs of abating. For Brazil’s auto manufacturers, making supply meet demand will be the biggest test of the last few decades.

Need Electronic Components?

When you need to source hard to find electronic components quickly because of allocation, long lead times, obsolescence, or quality issues, contact Lantek for a fast response to your enquiries and a reliable on time delivery. Email Sales@lantekcorp.com or call 1-973-579-8100 today.