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IC supply priority shifting to non-consumer products for 2022

ICs for consumer products are expected to see worse shortages than other applications in 2022 as many IC design houses have prioritized supply capacity for non-consumer chip offerings with higher profit margins, according to sources from the upstream supply chain.

The overall IC supply shortage is expected to persist through 2022, but the crunch of some commercial and automotive chips will improve a little next year as IC designers will allocate more foundry capacity for such chips to secure higher profitability, the sources said.

The sources noted that market prospects for consumer devices remain unclear, driving IC designers to utilize more available foundry and backend capacity for other higher-end applications.

Additionally, the sources continued, clients of consumer applications are relatively reluctant to accept quote hikes enforced by IC design houses to reflect ever-higher foundry costs, prompting fabless chipmakers to reduce the ratios of their chip shipments for consumer devices.

Consumer chips, except those for devices involving higher-end technology, will surely see a lower pecking order in 2022 at most IC designers, who are set to devote more supply capacity to commercial and automotive chips, the sources stressed

Display driver IC (DDI) vendors including Novatek Microelectronics, Himax Technologies, and Raydium Semiconductors have all stressed that securing capacity for OLED DDI and automotive TDDI chips will be their top priority for 2022, while network IC specialist Realtek Semiconductor is also confident that its shipments of car-use Ethernet chips will grow explosively next year.

By DIGITIMES

Link:https://www.digitimes.com/news/a20211228PD208.html?mod=3&q=IC

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