The global problem in production of computer chips is now targeting major companies like Apple. CEO Tim Cook reveals they still have no problems with the supply for now. But, when Q3 strikes, a problem might soon occur.
Even the biggest companies in the world like tech giant Apple is now warning their customers of possible shortage in production, in the coming months. This was after CEO Cook revealed that supply constraints could happen once months of July to September arrive. But, what’s the cause of all these supply shortages?
iPad and iMac shortages in September?
Before all the speculations of Apple products getting run-out pop-in on various news sites and social media pages, the tech giant has now cleared the air. In a 9to5Mac report, Apple CEO Cook and CFO Luca Maestri explained their side on the global issue.
Good news, the Cupertino-based company was able to secure massive number of computer chips for the productions in second quarter of the year. However, this supply will not last until the third quarter. This was the revelation of Cook and Maestri during their report of record earnings.
“We did not have a material supply shortage in Q2. You wind up collapsing all of your buffers and offsets. That happens all the way through the supply chain. That enables you to go a bit higher than what we were expecting to sell when we went into the quarter,” said Cook in the interview.
This means, from the month of July up to September, a serious problem in Apple production could occur once the company lacks in computer chips. What’s worse is that the company is just starting to introduce its newest model of iMac and iPad Pro, with pre-orders beginning on Friday, April 30. Soon, this could result to a hoarding of supplies, and third-party selling them for doubled or tripled prices.
Why is there a global computer chip problem?
This week has been a tiring week for all the tech companies in the world. Surprisingly, computer chips’ producers weren’t able to make supplies of their product due to delays over the pandemic. Cisco chief Chuck Robbins even told the BBC: “We think we’ve got another six months to get through the short term.”
Robbins explained that advances in technology like cloud computing, 5G technology, and artificial intelligence, had resulted for companies to hoard their products. Now, they expect to return to their normal supply chain by the next 12 to 18 months.
“Right now, it is a big problem,” he says, “because semiconductors go in virtually everything.”
Why not get from abroad?
One of the choices that companies are now left out with is to get computer chip supplies from outside the United States. For example, 75% of global manufacturing capacity is in East Asia. Taiwan’s TSMC and South Korea’s Samsung are the dominant players. At the same time, China is also looking forward to meet supply.
Unfortunately, Intel’s new chief executive Pat Gelsinger said that getting supplies from Asia may not be a good problem-solving tactic for the companies.
“Having 80% of all supply in Asia simply isn’t a palatable manner for the world to have its view of the most critical technology,” he said. “This is the heart of every aspect of human existence going forward. And the world needs a more balanced supply chain to accomplish that. We’re stepping in.”