Frying Pan Into the Fire -- Chip Shortage

MarcSpaz

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No, not weird. PO's are coded to provide priority for some specific Government purchases.

Government pays top dollar for things they want. Im sure the priority on chips. Auto Manufacturers im sure are wanting to pay the least as possible to keep high profits.


I am a computer scientist acting as an independent consultant, performing computer systems engineering, for DOD and federal law enforcement agencies. I thought most of the folks I have been chatting with for the past few years new that based on other conversations... so I made a lame attempt at being funny.
 

Weather Man

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The Biden administration says it is considering using the Defense Production Act as a remedy to address the ongoing shortage of semiconductor chips in the U.S., and have reportedly already threatened companies with the prospect.

Commerce Secretary Gina Raimondo told Bloomberg on Thursday she has warned industry leaders that the DPA is on the table, claiming businesses are not cooperating with the agency's requests for their data regarding supply chains.

"What I told them is, ‘I don’t want to have to do anything compulsory but if they don’t comply, then they’ll leave me no choice,’" Raimondo told the outlet. "I said today we’re evaluating all of our options right now, all the tools. I hope not to go there but we need to see some progress and we definitely need compliance."

Also on Thursday, the White House released a briefing on the semiconductor shortage and ways the administration is trying to address the issue.

The memo signaled that greater action from the feds is forthcoming, saying that "an individual firm’s ability to pivot quickly in the face of a shock can be limited by collective action problems—including a lack of communication and trust between firms along a supply chain—and a lack of access to the data necessary to support visibility and agility." It went on to argue, "Government has a unique ability to solve coordination challenges and serve as a trusted source of data."

In July, one administration official told FOX Business that Raimondo was looking to potentially build several semiconductor plants in the U.S. to help solve the shortages. As of the time of that report, the commerce secretary had met with roughly 50 companies to address the issue, and she encouraged chipmakers to ramp up production.
 

MarcSpaz

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There are so many issue I have with the government getting involved in this. The federal government should not be forcing private businesses to over-produce or even produce at all. We are citizens, not slaves. the concept of "too big to fail" is just spilling over into this issue.

And the quote that the "government has a unique ability to solve coordination challenges and serve as a trusted source of data." is complete bullshit. Leveraging a global crisis for Capitalist business opportunities under the guise of the interest of the people is 100% crap and should NEVER be aloud.
 

me32

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There are so many issue I have with the government getting involved in this. The federal government should not be forcing private businesses to over-produce or even produce at all. We are citizens, not slaves. the concept of "too big to fail" is just spilling over into this issue.

And the quote that the "government has a unique ability to solve coordination challenges and serve as a trusted source of data." is complete bullshit. Leveraging a global crisis for Capitalist business opportunities under the guise of the interest of the people is 100% crap and should NEVER be aloud.
Considering they cant do anything right. I agree. They only made the problems worse.
 

Weather Man

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Elon Musk upgrades global chip shortage to just a 'short-term' problem

  • Tesla (NASDAQ:TSLA) CEO Elon Musk thinks the semiconductor shortage will be over by next year as the supply chain normalizes.
  • "There's a lot of chip fabrication plants that are being built and I think we will have good capacity by next year," he stated at a tech event in Italy today.
  • Musk has called the chip issue a "huge problem" in the past, although Tesla is considered in better shape than many of the Detroit and Tokyo majors.
  • Musk's view is a little rosier than some industry watchers who expect the shortages to last until 2023. Chip giants Intel (NASDAQ:INTC) and TSMC (NYSE:TSM) both have new plants in the U.S. planned for next year, but they won’t come online for several years after that.
  • The global chip shortage has impacted the Green Tidal Wave investing thesis, although some analysts think it has given startups like Fisker (NYSE:FSR), Lucid Group (NASDAQ:LCID), Lordstown Motors (NASDAQ:RIDE), Rivian (RIVN) and Faraday Future Intelligent Electric (NASDAQ:FFIE) more time to get their production plans in order.
  • The electric vehicle sector was buzzing yesterday alongside a broad rally in auto names.
 

Weather Man

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U.S. chip makers log gains, shrugging off China power restrictions

  • AMD has reversed course from the early morning, moving to a 1.1% gain along with a few semiconductor peers bucking the down market in technology today.
  • The developments come alongside the prospects that a Chinese tightening of energy consumption could worsen ongoing supply-chain disruptions, as firms in China curb production to comply.
  • Intel (NASDAQ:INTC) has also risen to a gain of 0.5%, and Micron (NASDAQ:MU) is up 1.1% now. Xilinx (XLNX +1.2%) and Qorvo (QRVO +0.7%) are higher while much of the rest of the sector is still down, notably Nvidia (NVDA -2.7%) but also including Broadcom (AVGO -0.6%), Qualcomm (QCOM -0.7%), Analog Devices (ADI -1.2%) and Texas Instruments (TXN -1.1%).
  • Meanwhile, European suppliers today have largely dismissed worries over the power story - STMicroelectronics (NYSE:STM) is down just 0.6% in NYSE trading - and Europe and the U.S. are set to announce chip commitments on Wednesday at a Pittsburgh meeting of the Trade and Technology Council.
  • Progress in the semiconductor arena between the U.S. and Europe diverges from ongoing conversations about section 232 tariffs on steel.
 

Weather Man

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Ford CEO: $11.4B investment boosts EV manufacturing, improves supply chain

  • Jim Farley, president and CEO of Ford (NYSE:F), said Tuesday that an $11.4B investment in electric-vehicle manufacturing capacity represents a bet on a new market, as well as an opportunity to create a local supply chain that reduces its reliance on overseas sourcing.
  • Speaking to CNBC, Farley also provided an update on the global computer chip shortage, saying that he expects supply bottlenecks to last until the end of next year.
  • Ford announced Tuesday that it would invest $11.4B in an EV manufacturing facility and three battery plants.
  • Farley reported that the program will lead to the construction of the biggest manufacturing facility in the history of the company, taking up six square miles.
  • The investment will fund the creation of an assembly plant, as well as facilities to both manufacture and recycle batteries.
  • Farley said part of the goal of the program was to keep component production local, so supply chain problems like the chip shortage would become less likely in the future.
  • "We are creating a local supply chain that's circular so that we don't have to rely on anyone," he said.
  • The Ford CEO noted that many customers for its electric vehicles are new to the company, a fact that encouraged it to build a new plant rather than rely on retrofitting older facilities.
  • He added that constructing a custom-designed facility also allowed it to keep the plant carbon neutral.
 

tones_RS3

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I got an email from the BMW salesman and he told me the chip shortage doesn't affect them. He said if I order, It'll be 8- 12 weeks till delivery.
Not sure if he's blowing smoke up my ass or not. Just passing that along.
 

cobracide

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So where is this great big and rich deposit of rare earth minerals at in North America??? Hum I'll wait for the evidence there slick (Farley)

There really isn't much in NA. As luck would have it - it's mostly in china.
iu
 
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Weather Man

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The chances for any company to get a mining permit in the USA through with the Biden administration is between slim and none.
 

cobracide

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I got an email from the BMW salesman and he told me the chip shortage doesn't affect them. He said if I order, It'll be 8- 12 weeks till delivery.
Not sure if he's blowing smoke up my ass or not. Just passing that along.
The whole reason for the car manufacturer chip shortage is the car manufacturers. When covid hit, they didn't re-up the ordering of new chips. So their "just in time" supply chain has now been hit. Plus the extra capacity they gave away was immediately taken by other companies.

It's more than possible that BMW is smarter than most other car companies in their ordering of new chips and stocking.
 
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Weather Man

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cobracide

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We'll see, permits for mining have not been doing so swell. I think that bill also has some pretty onerous new mining taxes in it.
We don't really make a lot of anything here anymore and there is not much to mine anyways. Really, if we can just cover our military chip production that would be pretty ok.
 

Weather Man

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Samsung close to finalizing $17B Texas chip plant - Reuters

  • Samsung Electronics (OTC:SSNLF) is close to finalizing construction of a second, $17B semiconductor factory near Austin, Texas, Reuters reports.
  • The factory would make advanced logic semiconductor chips and create ~1,800 jobs, the company has said previously in filings to state officials.
  • The Austin suburb of Williamson County is considered the frontrunner because of subsidies offered by the state as well as the likelihood of stable sources of electricity and water, according to the report.
  • Samsung's outlook is boosted by a robust semiconductor memory market, Khaveen Investments writes in a bullish analysis posted this summer on Seeking Alpha.
 

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