IBM: Chip Shortage Could Last for 2 Years

The global chip shortage that has brought car manufacturers to a standstill and threatens to push inflation higher could last as long as two years according to IBM president Jim Whitehurst.

The shortage has largely been brought on by the closing of microprocessor manufacturing facilities worldwide despite the sales of laptops, game consoles, and mobile phones skyrocketing.

Whitehurst predicts that this will have continued adverse effects on the global auto industry, which he estimated could lose as much as $110 billion during the shortage in an interview with BBC News.

“There’s just a big lag between from when a technology is developed and when a fabrication plant goes into construction and when chips come out,” Whitehurst told BBC world business news.

“So frankly, we are looking at couple of years … before we get enough incremental capacity online to alleviate all aspects of the chip shortage.”

In response to the rising demand for tech and the continually diminishing supply of chips, Whitehurst suggested that manufacturers might need to start repurposing old hardware.

Car makers who cancelled orders for chips in the early stages of the pandemic have now been caught by the surprising resurgence of demand and are looking for alternative solutions. Ford executive Jim Farley expressed interest in partnering directly with microchip manufacturing plants Ford’s annual shareholder meeting.

According to reports from the meeting, Ford estimates that it will lose $2.5 billion from the chip shortage alone in 2021.

Other industries are feeling the effects of the shortage, including Samsung, who says that the production of phones and TVs will likely slow in the coming months with supply running short.


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