Semiconductor Shortage Takes a Bite out of Apple

Semiconductor Shortage Takes a Bite out of Apple

May 18, 2021

 

 

A shortage of semiconductors is affecting the production of cars and electronics.

This is another example of a bottleneck in a strained supply chain. Several factors converged to create the current situation, and it appears that consumers will have to endure the consequences of disrupted supply chains for some time. A solution to the problem is to strengthen the domestic supply chains, but it will take years to implement.

 


Video Spotlight: The Reasons for the Semiconductor Shortage


This post is based on the npr.org article, Get Ready for a Shortage of iPads and MacBooks, by C. Domonoske, April 29, 2021, and the YouTube video, Worsening Semiconductor Shortage Spreads Beyond Vehicle Manufacturers to Hit Apple, Samsung, by Arirang News Center, April 30, 2021. Image source: Jag_cz/Shutterstock.

Discussion Questions:

1. According to the information provided in the video and the article, what are the conditions that created a shortage of semiconductors?

Guidance: The underlying problem is the reliance on a handful of suppliers throughout the world. Even though US companies have 47% of the global chip market, they manufacture only 12% of the chips. Today, Taiwan and South Korea have the most advanced fabrication Continue reading

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Factors Affecting Supply Chain Resilience

Factors Affecting Supply Chain Resilience

COVID-19 has exposed many vulnerabilities in our supply chains.  Of particular note are supply chains for food and personal protective equipment (PPE).

Most people take for granted that we can walk into a grocery store, and leave with a wide variety of food items.  However, in Spring 2020, this was not the case.  Many store shelves were bare, including some essentials such as flour and pasta.  Many farmers destroyed milk, eggs, and chickens, while other crops rotted in the field.

Similar problems have occurred across almost every supply chain.  Shortages of PPE occurred during the early stage of the pandemic. Most PPE production was concentrated in China.  The combination of disrupted production and transportation and increased demand created shortages.

Shipping containers have made worldwide transportation more efficient and reliable.  As a result, organizations have spread their supply chains throughout the world to increase their efficiencies.  This has also led to concentration of production, a reduction in the number of suppliers, and added a bottleneck, as seen in the recent blockage of the Suez Canal.

The food supply chain illustrates many problems brought on by a search for efficiencies.  To increase Continue reading

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Big Ship Creates Big Backlog

Big Ship Creates Big Backlog

When the Ever Given got stuck in the Suez Canal, its gigantic size became a gigantic problem.

To support an ever-expanding global trade, ship size has been increasing for decades. Today, the largest ships can carry between 18,000 and 24,000 containers.  A larger cargo makes perfect economic sense because the cost of shipping one container decreases as cargo capacity increases. However, when things go wrong, big ships mean big disruptions in an already strained global supply chain. It is estimated that the stranded ship held up 12% of global trade at an estimated cost of $9.6 billion a day. This financial and logistic threat, along with more elusive cost savings in the future, may signal the need for fresh ideas in global shipping.

 


Video Spotlight: The Ripple Effects of the Backlog


This post is based on The New York Times article, Why the World’s Container Ships Grew So Big, by N. Chokshi, March 30, 2021, and the YouTube video, Cargo Ship Freed from Suez Canal, but Shipping Backlog Could Last, by CBC News: The National, March 29, 2021. Image source: (c) Glow Images/SuperStock.

Discussion Questions:

1. Will the short-lived blockage have a major Continue reading

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