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By Arghyadeep Dutta, 3:00 pm ET:
The amount of time it takes to get semiconductors delivered for chip-starved companies has increased to more than 20 weeks, indicating the global chip shortage that is affecting the automakers and the tech companies is getting worse.
Chip lead times, the interval between ordering semiconductors and taking delivery, increased by more than eight days to 20.2 weeks in July from the previous month, according to the Susquehanna Financial Group report.
In June, the time waiting time was recorded at 19.3 weeks.
That gap is already the longest wait time since 2018, when the lead time peaked at 14 weeks. The firm began tracking the data in 2017.
Shortages of microcontrollers, logic chips that control functions in cars, industrial equipment, and home electronics jumped in July, with the lead time increased to 26.5 weeks, according to the report. A typical range for that kind of chip lead time is six to nine weeks.
However, the lead times for power management chips that regulate the flow of electricity in electronic devices were reduced.
The global chip shortage has affected the automotive industry the most, and it is expected to lose more than $100 billion in sales of vehicles due to delays in the production line.
The technology companies, especially the electronics device makers, including the biggest companies such as Apple Inc, said that they are unable to meet all the demand for their products.
A lead time is a matric, which industries look for to know how demand is trending when companies are over-ordering and building inventory.
Semiconductor industry executives have alerted against making the assumption this time, arguing their customers are more willing to make long-term supply commitments than in the past.