For the past several years, the electronics industry has been struggling to keep up with the increasing demand for components of electronic devices. It’s a delicate balance between supply and demand, but the current climate has tipped the scales in favor of supply. Unfortunately, the consequences could become dire.
The automotive industry has helped fuel the higher demand for electronic components. Technologies which were only available in the luxury vehicles of yesterday are now becoming standard features. The ensuing demand is overwhelming the manufacturing capacity. The shortfall is not expected to be a brief anomaly but a long-term problem.
The reverberations of the growing demand for electronic components in the automobile industry is being felt broadly. Consider the case of the ordinary resistor, which is an essential component in many home electronic devices. The recent spate of natural disasters resulted in the destruction of many household electronics that led people to buy replacements. This put pressure on electronics manufacturers to ramp up production and resulted in a shortage of components.
On another front, manufacturers are scrambling to increase production of electronic devices to satisfy insatiable demands for mobile devices and the ubiquitous shift to cloud technology. Component manufacturers are straining to keep up with the mobile revolution.
In the face of high demand and low supply, electronics production is struggling to source components. The resulting scarcity is driving up costs. Unless component manufacturers find ways of ramping up production in sustainable ways, the electronics industry will have a sizeable problem on its hands.