The global chip shortage is restricting the growth of all major industries that rely on these microcontrollers. But Foxconn shared a relieving news yesterday. According to the company, the second half of 2022 is heading in a better direction.
As Shanghai’s COVID restrictions begin to decrease, the company is expecting a productive second half in 2022. The Shanghai government will allow all residents in ‘low-risk’ areas to return to work from Tuesday.
The unforeseen global chip shortage
Tiny microcontrollers became a part of every industry and COVID exposed the dependence of these industries on the chip makers. The pandemic disrupted the global supply chain and reduced the production of many crucial components including microcontrollers.
Last, month BMW revealed that it had to switch chip makers to ensure that car production didn’t experience a screeching halt.
“A car that costs tens of thousands of dollars cannot be shipped because of a tiny chip worth fifty cents. This has been a pain for our customers,” said Foxconn chairman Liu Young-way.
It is the actual situation that carmakers are facing with their newer generation models that rely on chips from Foxconn. The company is eying to become the biggest chip supplier for the electronic vehicles market globally. According to Reuters, Foxconn aims to capture around 5% of the chip manufacturing and supply of the EV market by 2025.
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It seems to be a rather huge goal but the company expects that they can do it in the remaining two and a half years. Foxconn shared that the revenue for this quarter could slip further down due to a variety of reasons.
Rising inflation, China’s lockdown, and supply chain constraints have been merciless on the production capacity. However, this could be a temporary slump after which the company aims to ramp up manufacturing.
Do you think the global chip shortage will end this year? Or it will go on for a couple of years more? Share your thoughts in the comments.