Intel CEO Pat Gelsinger reaffirms belief that the chip shortage will last until 2023

midian182

Posts: 7,777   +79
Staff member
Forward-looking: Intel CEO Pat Gelsinger has reiterated his belief that the global chip shortage will not improve until at least 2023. While Chipzilla has been investing heavily in new manufacturing facilities recently, the fruits of those endeavors won’t be seen for several years.

Speaking in an interview with Nikkei Asia, Gelsinger reaffirmed that the issues consumers are facing when it comes to buying goods such as graphics cards, or anything with a chip in it, aren’t going to get better next year.

Gelsinger made the statement during a trip to South East Asia for talks revolving around the importance of Asian manufacturing to Intel. The CEO also used the visit to announce that Intel would be spending $7.1 billion on a new facility in Malaysia, which comes after the company revealed it would invest up to €80 billion ($94.7 billion) in building new chip plants in Europe. There are also the two Arizona plants expected to become fully operational in 2024.

While Intel is investing plenty of money into its future manufacturing capacity, things aren’t so rosy in the near term; Gelsinger has predicted that the chip shortage won’t start to alleviate until 2023. Although some other big names in the industry, including AMD boss Lisa Su, believe 2022 is a more realistic forecast, the emergence of the Omicron Covid variant and increasing geopolitical tensions have put a dampener on hopes that the situation will improve sooner rather than later.

Gelsinger has recently been involved in a public spat (of sorts) with TSMC, having warned against relying too much on Taiwanese manufacturing, given China’s increasing aggression in the region. "Beijing sent 27 warplanes to Taiwan's air defense identification zone this week. Does that make you feel more comfortable or less?" he said. The CEO also called for the US government to spend the $52 billion it has set aside for semiconductor funding exclusively on domestic companies.

Ampere and RDNA 2 prices make for depressing reading

TSMC responded by saying that reserving the $52 billion for American firms would be “very negative for the United States." Additionally, co-founder Morris Chang said that Gelsinger doesn’t have enough time to take Intel back to the top due to its age restrictions on executives, though the company says its execs are asked to retire at 75 and not 65. However, Gelsinger appeared to change his tune during the Asia trip by calling TSMC “spectacular.”

The chip shortage is being felt even more now that Christmas is around the corner. Consoles, PC hardware, and even domestic appliances are both difficult to find and more expensive—considerably more, in some cases. Facing another year of this is certainly a depressing thought.

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QuantumPhysics

Posts: 6,262   +7,176
Do the smart thing and invest in companies being built to address the shortage.

Invest in companies that are themselves directly focused on addressing the shortage.

Chances are there will be a huge boom in chip production followed by a bust-recession cycle when you can cash out.
 

Arbie

Posts: 362   +655
He was referring to competitive chips from Intel.

(OK, not entirely fair... but I am an AMD fanboy)
 

Sausagemeat

Posts: 1,597   +1,419
He was referring to competitive chips from Intel.

(OK, not entirely fair... but I am an AMD fanboy)
Definitely not entirely fair. Intels desktop chips are about the only competitively priced desktop chips out there and in stock atm. You can still buy Ryzen 5000 but they cost more and perform worse than Intels Alder lake. They should have had a price cut but we haven’t seen it.

It’s just a massive shame that Intel aren’t using their fabs to make their GPUs, us PC gamers want graphics cards to become more available.
 

gamerk2

Posts: 685   +643
To be fair, there has been an ongoing semiconductor shortage going back for well over a decade now, but this is the first time consumers are really seeing it.

I work in an industry where we do a lot of design work and produce some in-house circuit boards/System-On-Chips. Getting basic components have been on 24-32 month backlogs for literally YEARS now since a handful of companies (you know the ones) have been eating up all the stock. And even before the pandemic other components were starting to get backlogged. But your iPhones and new GPUs kept releasing on time, so no one bothered to notice the entire industry was already heading toward a major undersupply. The Pandemic just sped things up a bit and made the issue much more obvious.

So my take: Intel is being optimistic here. We're internally projecting backlogs through at least '25.
 

gamerk2

Posts: 685   +643
In other words, we will like to keep milking this crisis until the end of 2023.
As I noted above, there's been a real outstanding supply issue for over a decade. Production has reached pre-pandemic levels again, but the excess demand combined with the fact there was a pre-existing shortage means it will take several years to go through the glut in existing demand for things to get close to normal.
 
As I noted above, there's been a real outstanding supply issue for over a decade. Production has reached pre-pandemic levels again, but the excess demand combined with the fact there was a pre-existing shortage means it will take several years to go through the glut in existing demand for things to get close to normal.
As I noted above, there's been a real outstanding supply issue for over a decade. Production has reached pre-pandemic levels again, but the excess demand combined with the fact there was a pre-existing shortage means it will take several years to go through the glut in existing demand for things to get close to normal.
Sheeps will believe anything these days. Its all fake, they keep supply low to milk as long as they can. No government intervention or oversight. Its like the market for diamonds.
 

gamerk2

Posts: 685   +643
Sheeps will believe anything these days. Its all fake, they keep supply low to milk as long as they can. No government intervention or oversight. Its like the market for diamonds.
Eh, no. Your wrong for a very simple reason: It wouldn't be very capitalistic of any foundries to intentionally withhold supply in this case. Likewise, if they were intentionally withholding supply, they wouldn't then be spending literally tens of billions of dollars to build new foundries to increase supply. You only do that when you project continued supply shortages for years down the line.

Secondly, it's not like output for each foundry isn't a known thing. Supply is back up to 2018 levels; the issue right now is demand is FAR in excess of that.

The Diamond example you give is a special case, since in that particular instance one company has total control over the entire distribution network of what is otherwise a fairly common mineral, combined with spending billions on propaganda to make the market support the intentionally ramped up market prices.
 

Tantor

Posts: 292   +530
Eh, no. Your wrong for a very simple reason: It wouldn't be very capitalistic of any foundries to intentionally withhold supply in this case. Likewise, if they were intentionally withholding supply, they wouldn't then be spending literally tens of billions of dollars to build new foundries to increase supply. You only do that when you project continued supply shortages for years down the line.

Secondly, it's not like output for each foundry isn't a known thing. Supply is back up to 2018 levels; the issue right now is demand is FAR in excess of that.

The Diamond example you give is a special case, since in that particular instance one company has total control over the entire distribution network of what is otherwise a fairly common mineral, combined with spending billions on propaganda to make the market support the intentionally ramped up market prices.

Actually, it's very capitalistic. You don't need to have monopolies where one company has most of the market. Corporations can create quasi-monopoly conditions by collusion. The goal is to raise the prices for the entire market. They all benefit at the expense of the consumer. Read about the light bulb price fixing during the 1920's.
 

JCX88

Posts: 10   +7
Definitely not entirely fair. Intels desktop chips are about the only competitively priced desktop chips out there and in stock atm. You can still buy Ryzen 5000 but they cost more and perform worse than Intels Alder lake. They should have had a price cut but we haven’t seen it.

It’s just a massive shame that Intel aren’t using their fabs to make their GPUs, us PC gamers want graphics cards to become more available.
You gotta include MB pricing for 12th gen chips. So you can get 5900x for $450 and pair it with $200 board or you can get $400 12700k and pair it with identical board but for $300. So 12700k option is actually more expensive. If you do go for cheapest MB and can make do with $90 board and for Intel it's $220 - even bigger difference. And this is ddr4 boards. For ddr5 difference is even bigger.

Also Intel chips while superior have compatibility problems - some games won't work.

Market pricing is accurate right now.
 

Sausagemeat

Posts: 1,597   +1,419
You gotta include MB pricing for 12th gen chips. So you can get 5900x for $450 and pair it with $200 board or you can get $400 12700k and pair it with identical board but for $300. So 12700k option is actually more expensive. If you do go for cheapest MB and can make do with $90 board and for Intel it's $220 - even bigger difference. And this is ddr4 boards. For ddr5 difference is even bigger.

Also Intel chips while superior have compatibility problems - some games won't work.

Market pricing is accurate right now.
The Intel and AMD boards are not the same, the more expensive AM4 X570 lacks PCIe5 and thunderbolt. You pay more and you get more.

Most users who would be buying unlocked K series Intel chips are probably better off on the more expensive boards, these are not budget customers typically. Before Z690 I think most of these users would have favoured X570. I certainly would want to be on Z690 over any other platform right now. AMD is priced to high to be worth it currently And that will be more apparent when Intels cheaper boards drop sometime soon.
 

maladaptiv

Posts: 9   +16
The Intel and AMD boards are not the same, the more expensive AM4 X570 lacks PCIe5 and thunderbolt. You pay more and you get more.

Most users who would be buying unlocked K series Intel chips are probably better off on the more expensive boards, these are not budget customers typically. Before Z690 I think most of these users would have favoured X570. I certainly would want to be on Z690 over any other platform right now. AMD is priced to high to be worth it currently And that will be more apparent when Intels cheaper boards drop sometime soon.
Wrong. AMD X570 have Thunderbolt. They dont have only PCIe5 which still cant be used to its full potencial. As for Intel K series customers are better off with Intel options, get off your high horse. And pricing is + - competetive between Intel and AMD. It is just BS what you are writing. If the situation changes, for example there will be cheaper Intel platform options, AMD will definitively change their pricing.
 

captaincranky

Posts: 18,527   +7,370
Gelsinger has recently been involved in a public spat (of sorts) with TSMC, having warned against relying too much on Taiwanese manufacturing, given China’s increasing aggression in the region. "Beijing sent 27 warplanes to Taiwan's air defense identification zone this week. Does that make you feel more comfortable or less?" he said. The CEO also called for the US government to spend the $52 billion it has set aside for semiconductor funding exclusively on domestic companies.
The interesting thing about TSMC building a fab in the US, is that it forces the US into "sort of, "mutual defense agreement" with their PRC homeland..

Sort of a "tit for tat" narrative along the lines of, "hey, we built factories here in your country, you can't let the CCP take our factories away back home".
 

mailpup

Posts: 7,743   +827
TS Special Forces
The interesting thing about TSMC building a fab in the US, is that it forces the US into "sort of, "mutual defense agreement" with their PRC homeland..

Sort of a "tit for tat" narrative along the lines of, "hey, we built factories here in your country, you can't let the CCP take our factories away back home".
But TSMC is a Taiwanese company and while CCP claims Taiwan as part of China, Taiwan and the U.S. don't see it that way.
 

captaincranky

Posts: 18,527   +7,370
But TSMC is a Taiwanese company and while CCP claims Taiwan as part of China, Taiwan and the U.S. don't see it that way.
Recently, China was discovered painting mockups of US aircraft carriers on their desert interiors. Then they flew 29 warplanes into Taiwanese airspace, which were intercepted by PRC aircraft.I fully agree that the US doesn't consider Taiwan as a part of China proper, but a sovereign nation. Strategically, are these actions just annoyances, testing what our responses might be, or something more sinister? You know yourself that Asian culture and motivations have been considered, (or rumored) to be "inscrutable" to westerners.

My point wasn't that we consider Taiwan its own entity, but rather that TSMC having facilities within the US, forces that agreement of Taiwan's sovereignty, to be, of necessity, more interlocutory. I didn't place any value judgement, or predict a strategic outcome of the situation. I was simply stating facts, as I perceive them.

More simply put, before TSMC arrived here in the US, we should or would defend Taiwan, now it's an imperative that we do. Don't think China is unaware of, or ignoring, this development either.

China has been doing more vigorous saber rattling recently regarding their position on Taiwan as a province of China. The fall of Hong Kong's "democracy", might be a harbinger of China's aspirations to annex Taiwan at an unknown future date.

Recently, a Chinese bigwig,,(I don't know who, his title, when, or where it happened), raised a big theatrical stink, over someone from the US, entitling Taiwan as, "a country".

However insignificant a single fab in the US might be to the Chinese economy, I believe that they also might interpret it as a threat.. And let's face facts, #45 has gotten then all riled up regarding trade relations.

One thing that always frightens me is, should a war develop between the US and China, we'd have to kill them at a 5 to 1 ratio, just to arrive at a null outcome. :eek:

One conspiracy I do buy into, is that the release of covid, was from the Wuhan lab, and it was intentional, not accidental. It's (relative), lack of lethality, imparts, "plausible deniability", to its actual origins. (Fish market, my a**).! Any compound with a higher mortality rate would have immediately been flagged as "germ warfare".

Like the British said to the Indians, "are you guys cold, here take these blankets".
 
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Sausagemeat

Posts: 1,597   +1,419
Wrong. AMD X570 have Thunderbolt. They dont have only PCIe5 which still cant be used to its full potencial. As for Intel K series customers are better off with Intel options, get off your high horse. And pricing is + - competetive between Intel and AMD. It is just BS what you are writing. If the situation changes, for example there will be cheaper Intel platform options, AMD will definitively change their pricing.
Actually I am mostly correct and you are wrong.


Stop talking out of your butthole, most X570 boards do not have thunderbolt. But practically all the Z690 boards do…
 

Shadowboxer

Posts: 2,071   +1,650
Wrong. AMD X570 have Thunderbolt. They dont have only PCIe5 which still cant be used to its full potencial. As for Intel K series customers are better off with Intel options, get off your high horse. And pricing is + - competetive between Intel and AMD. It is just BS what you are writing. If the situation changes, for example there will be cheaper Intel platform options, AMD will definitively change their pricing.
That’s BS. My Asus X570 Tuf Gaming ($200 board) doesn’t have thunderbolt and when I bought it none of the boards I was looking at had it.
 

Shadowboxer

Posts: 2,071   +1,650
The Intel and AMD boards are not the same, the more expensive AM4 X570 lacks PCIe5 and thunderbolt. You pay more and you get more.

Most users who would be buying unlocked K series Intel chips are probably better off on the more expensive boards, these are not budget customers typically. Before Z690 I think most of these users would have favoured X570. I certainly would want to be on Z690 over any other platform right now. AMD is priced to high to be worth it currently And that will be more apparent when Intels cheaper boards drop sometime soon.
I bought a 5800X and an X570 board last year. If someone told me to save $60 and get a budget B550 board instead I would have laughed at them. You don’t buy a premium CPU and fit it to a budget board. Budget boards are for budget CPUs which just don’t exist on Ryzen at the moment.

If I were buying today it’s an easy decision. Alder lake is better and cheaper than Ryzen 5000 and Z690 is better and only marginally more expensive than X570. So Intel wins hands down for me now. Obviously with a 5800X I have no need to upgrade.

But some people have an emotional preference to one these scummy companies for some bizarre reason and would still choose to pay more for worse tech because it’s from the company they like.