Severe Chip Shortage Hits Samsung, But Apple Is Spared

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The pandemic has had a major impact on the manufacture and supply of processor chips, and this seems to be worsening. Many car manufacturers have been struggling, and there have been issues getting hold of chips for AMD and nVidia graphics cards. Manufacturers of smartphones and other electronic devices have also been affected.

As Bloomberg reports, Samsung is even considering postponing the launch of its new Galaxy Note. As co-CEO Koh Dong-jin explained during a presentation to investors, the next quarter of the business year will be hit particularly hard. This is an unusual admission for Samsung, which is normally very secretive about its plans and product announcements.

Samsung is itself a manufacturer of chips, but for this it relies on being supplied with preliminary products made by other manufacturers. A Samsung factory in Texas was also shut down due to a severe power outage in February.

How Apple was spared from the chip shortages

Another reason for the chip shortage: the demand for smartphones was higher than expected during the pandemic.

Qualcomm’s Snapdragon chips, which are manufactured by TSMC, are particularly rare. These are a central component of many smartphones. LCD prices are also expected to rise.

Only Apple is not affected by this problem, according to the analyst MS Hwang of Samsung Securities. One reason is that Apple secures its supply well in advance, and gets priority treatment from its suppliers; another is that Apple is almost the only manufacturer that does not use Qualcomm chips in its iPhones, instead using its own CPUs. These chips do not appear to have suffered any supply failures so far.

However, as Nikkei reports, shortages may affect iPhone production indirectly. Samsung, which makes a huge quantity of OLED displays for the iPhone range, has had to shut down a plant in Texas for a month, and the plant made driver chips for those displays.

Across the market, prices are expected to rise, and the shortage is likely to continue for another six months.

The car industry has been more seriously affected by this shortage of chips than the smartphone manufacturers, and some of them have had to halt production. It is estimated that automakers will miss out on $61bn (about £44bn) in sales this year alone due to the production downtime.

Read about Apple’s plans for the year in our guide to the new Apple products coming in 2021. And catch the latest bargains in our regularly updated roundup of the best Apple deals.

This article originally appeared on Macwelt. Translation by David Price.





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