By John Harley, Director Business Development, UK & EMEA, OSI Electronics UK

PCB with semiconductors.  We manufacture complete printed circuit board assemblies – surface mount and through-hole – tailored to the design, specification and volume of your project.

There is optimism 2022 will see a significant improvement in electronic component supplies.

We have to be realistic about chip supplies this year. Of course we all want things to normalise, for lead times and costs to return to predictable levels and the manufacturing headaches which have plagued industry for the last two years to subside.

Is it a dream? So much depends on what is happening in China.

News in late December the city of Xi’an (pop 13 million) in north-western China was put in lockdown to help combat Covid only raises concerns and potentially dashes hopes of a recovery, for Xi’an hosts two major chip manufacturers, Samsung and Micron: both companies say they are having to ‘restrict production’ – for how long we don’t yet know.

This comes on top of other chip factory closures in 2021, some, as in Malaysia due to the pandemic, others because of serious fires (Japan), winter storms (USA) or power outages (China and Germany).

Market demand increasing

The reality, of course, is major upheavals can take weeks and months before normality returns for the companies involved and only add to the supply complexity at a time when raw materials – cardboard, copper, gold, silver – and shipping are either in short supply or shooting up in price. Often both.

Yet, ironically, the demand for semiconductors, microcontrollers, MEMs and other essential electronic components continue to grow as new ideas and new products rely more and more on the benefits of sophisticated electronics to improve performance and meet customer demands for safer, better, more automated products.

Optimism

But I am optimistic towards the end of 2022 the supply chain will improve – because the world vaccination programme against Covid will be effective, the plans and investments by component suppliers will increase capacity and buyers will be less inclined to panic buy as rationalisation of their own production schedules take effect. Energy prices will also, hopefully, fall.

People talk about the ‘perfect storm’ creating unforeseen problems – it can wok in reverse, too, with ‘good’ factors bringing sunnier days.

My purchasing and manufacturing colleagues in our factories around the world will certainly be hoping so – their worldwide component procurement programme could well work to your advantage.

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OSI Electronics UK is a subsidiary of Californian based OSI Electronics.

Posted 10th January 2022