Intel once again warns of chip shortage continuing until 2023

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As the Omicron variant spreads rapidly around the globe and hopes of a quick end to the pandemic fade into the rearview mirror, so too does our hope for a quick end to widespread chip supply shortages. Intel CEO Pat Gelsinger, in an interview with Nikkei Asia stated that he doesn’t expect the ongoing chip shortage to ease before 2023. The plans for your new gaming rig might have to be delayed even longer.

Gelsinger’s comments came during his South East Asia business trip, where Intel announced a 7.1B investment to expand its manufacturing in Malaysia. He teased even more Intel investment to come, saying: “I expect to announce our next major U.S. site and our next major European site in the near future as well.” It’s good to see all major semiconductor manufacturers taking some of their huge profits and investing them, so that the world has some buffer to protect against future supply shocks.

The problem is, these facilities don’t just spring up overnight. Gelsinger himself said that additional manufacturing capacity can take at least three years to yield results. Intel’s previously announced expansions in the USA, Israel and Ireland are still a long way from beginning production.

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Several big tech CEOs have made statements over the last few months with predictions of supply improvements in 2022, or even oversupply, but with the Omicron variant rapidly spreading, it feels like expectations are being reset. There’s a feeling of one step forward and two steps back. And it’s not just the pandemic. There’s the USA-China trade war, China-Taiwan and Russia-Ukraine concerns, protectionism and even weather, such as that which affected Texas earlier in 2021.

It’s not all doom and gloom though. Disruptions to global supply chains are partly due to strict lockdowns and precautionary quarantines, something that governments are increasingly less likely to impose on a large scale. Keeping factories up and running is obviously critical for global supply chains. Malaysia’s Senior Minister of International Trade and Industry Mohamed Azmin Ali stated: “I have assured Pat (Gelsinger) that there will be no longer lockdowns, only targeted ones.” This seems to be a trend, especially since it’s looking more and more like Covid-19 will become endemic.

TSMC silicon wafers

(Image credit: Taiwan Semiconductor Manufacturing Co., Ltd)

Still, sadly, it seems as though a return to normalcy in 2022 is looking more and more unrealistic. Consoles continue to disappear as soon as they are listed, DDR5 memory is pretty much unavailable and the GPU story isn’t going away. The GPU issue is as much a demand problem as it is a supply one. On that front, things should get better as mining demand begins to drop off as we get closer to Ethereum’s planned shift to a Proof of Stake consensus mechanism.

The investments that began at the of the pandemic will gradually start to bear fruit in 2022 and 2023. Let’s hope PC gamers have a happier 2022 holiday season. Building a new gaming rig right now isn’t impossible, but it’s still far more expensive than it should be.

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