Chip shortage causing car shortage. Same with flashlights?

[Dave_H]

As mentioned, not just microcontrollers and high-performance processors have supply issues. Not long before COVID struck I was involved in mitigation of supply issues with MLCC i.e. ceramic chip capacitors notably 0402 size. These days a smartphone has hundreds of various sizes, some upwards of a thousand each. That's when I was hearing the term "allocation" more.

Unfortunately just as with commodities like building materials (lumber as example) semiconductors and other components have been hit at both ends: supply and demand.

Online search tools can help locate inventory across different suppliers (FindChips is one) which can be revealing.

Dave

 

[bykfixer]

Malkoff a Maglite……problem solved……until he runs out of drop in's that is.

 

[jtr1962]

Because you are reading seekingalpha and not truly professional sources:

Coping with the auto-semiconductor shortage: Strategies for success

The semiconductor shortage is causing billions of dollars in lost revenue for the car industry. Here’s why it’s happening and how to move forward.

www.mckinsey.com

They put more stake in compatibility of things like RF at similar node sizes to other chips, but the processes are different enough that that is a questionable claim.

Interesting article. They mentioned JIT as one of the reasons for the problem. I've long thought that JIT was never a particularly good idea, especially when part of your supply chain is halfway around the world. All you need is one major supply disruption to wipe out months or years of savings from JIT.

 

[GoVegan]

Malkoff a Maglite……problem solved……until he runs out of drop in's that is.

Gene certainly won't be immune to this problem, his drivers have many chips on the boards just the same as any other maker. In fact it's likely he'll be affected quicker than some other makers, because as a very small business he'll probabily keep less stock of items.

 

[bykfixer]

I guess you missed the part about "until he runs out"……

 

[GoVegan]

Speaking of Maglite, they'll survive this chip shortage, as they can continue to produce and sell their incandescent models, which as far as I know are still sold in huge numbers. I know for a fact that Uncle Sam still purchases them for the Army.

However I suspect we'll see some more flashlight makers disappear for good, same as we've previously seen others disappear or pull out of the game for various reasons (Pentagon, ARC, Novatac, PALight, Gerber, PFlexPro, Blackhawk, Terralux etc).

The chip shortage is expected to continue until early 2023, and I'm thinking even this is likely an underestimate as humans have a tendency to do this all the time.

Actually if I had to guess the first casualty in the flashlight business, my money would be on either Light & Motion (wait who? lol) or Malkoff disappearing. With Malkoff, just as well they are built to last, as that lifetime warranty will be useless.

On the opposite side of things, Peak LED Solutions, will be like, "meh flashlights?, we don't care about those sales anyway, we're too busy working on secret gov contracts". lol

 

[JustAnOldFashionedLEDGuy]

Interesting article. They mentioned JIT as one of the reasons for the problem. I've long thought that JIT was never a particularly good idea, especially when part of your supply chain is halfway around the world. All you need is one major supply disruption to wipe out months or years of savings from JIT.

With money cheap, it makes less sense, but there is always the worry that can turn and market does not like inventory. It likes to see capital working. It does show a lack of resiliency. A $1 item can prevent a $40,000 sales. However, the car makers can afford to pay more for a few items that make up a small part of overall cost. Hardest hit are sub-suppliers running on much smaller margins.

 

[xxo]

Ban on sale of USA made chips to China's huawei lifted:

Biden White House Approves Licensing Deal For Chinese Communist Party-Linked Huawei, Reversing Trump-Era Hardline. - The National Pulse+

The Biden White House granted the Chinese Communist Party-linked firm Huawei – which was crippled by Trump-era sanctions – licenses to purchase American auto chips, according to reports. The decision follows the Beijing-backed tech firm hiring several lobbyists, including the brother of Joe...

thenationalpulse.com