How the Component Shortage Can Affect Holiday Shopping
It’s the busiest time of year for consumer shopping, but the continued electronics component shortage might throw a wrench in any plans to snag gifts off the shelves of your favorite store this holiday season.
MLCC Shortage Could Cause Some Shelves to Sit Empty
Feel like the popular electronics are selling out faster than ever? As the passive component shortage continues to weigh heavily on manufacturing and electronics, MLCC (multi-layered ceramic chip capacitors remains one of the top sought-after components. The MLCC shortage alone led to a limited supply of consumer products on store shelves, putting companies and consumers in a bind during the busiest shopping season of the year.
Related: The Passive Component Shortage Demand and Impact on Industry
Market Demand from Last Christmas Prompted Current State
In late 2017, market demand for several electronics components surged and soon this demand exceeded supply – just as the holiday season commenced. Since then, the increase in demand combined with limited overall production capacity resulted in a component shortage that worsened throughout 2018. Major contributing factors included electronics such as popular computers and consoles, mobile phones, and automobiles.
Manufacturers rushed to meet demand – especially for the continuously evolving and technologically-advanced features in automobiles, including the shift toward technology that focuses on self-driving, or autonomous, vehicles, ADAS, vehicle-to-vehicle communications, onboard safety, convenience, environmental features, and continued interest in electric vehicles.
The demand continued to deplete supply, leaving manufacturers and companies who did not hold a large share of supply – companies like Samsung and Apple, who purchase a vast majority of this supply for mobile phones that change every year – wondering whether they’d be able to meet consumer demand.
Related: Will Supply Ever Catch Demand?
The Current State of the Component Shortage
As a result, manufacturers have begun to build more capacity for production, but others, wary of what has transpired during a similar situation in the past, have remained hesitant. Some manufacturers have even increased prices or have labeled many products and parts as “TBD” pricing – simply because they don’t know the true cost until it arrives.
Although the shortage is still going on, the outlook for automotive electronics remains robust, with forecasts revealing increases in sales for 2018 and 2019.
Related: Why Domestic Manufacturers are the Best Option During the Component Shortage
High demand and tight supply continue to loom over the industry. Lead times remain long, but the shortage shouldn’t last forever. For now, ensure you’re up to date on what’s happening with the component shortage and don’t try to wait it out. The decisions your company makes now will impact longevity and success.
If you have questions regarding orders, supply and more, contact us now.
