Ask HN: Why is there a chip shortage?
Several factors:<p>1. There was real and relatively sudden increase in demand:<p>a. COVID-driven in part, all students and many additional employees had to buy computers to study&#x2F;work from home,<p>b. a., driven by video, lead to increased demand on Internet &amp; telecom infrastructure.<p>c. Electric vehicles consume an order of magnitude more chips than ICE cars. EV demand is also skyrocketing.<p>2. There were fabs (semiconductor factories) shut down due to COVID. This one in Malaysia [0] makes power chips and was particularly problematic for ICE auto makers.<p>3. The first indication of problems manifested in chip lead times pushing out. As buyers started to see more and more of this, they started increasing orders and soon adopted a hoarding mentality, similar to why many of us couldn&#x27;t find toilet paper in stores early in the pandemic.<p>Result: As a personal anecdote, a chip that sells for $0.47 from that fab in Malaysia recently sold for $75 on the broker market.<p>Note that no, the state of the art fabs cannot be re-outfitted to make legacy chips. The old equipment they were developed on is generally no longer available and the profit from making those inexpensive chips would not justify the capital spend on new equipment.<p>[0] <a href="https:&#x2F;&#x2F;www.reuters.com&#x2F;article&#x2F;infineon-results-malaysia&#x2F;infineon-takes-revenue-hit-from-malaysia-shutdown-idUSL8N2PA236" rel="nofollow">https:&#x2F;&#x2F;www.reuters.com&#x2F;article&#x2F;infineon-results-malaysia&#x2F;in...</a>