As 2019 rolls into view, component shortages continue to wreak supply chain havoc on a variety of components from multilayer ceramic capacitors (MLCCs) and relays to metal-oxide-semiconductor field-effect transistors (MOSFETs). Lead times continue to stretch as component makers scramble to keep up with demands from growing and emerging markets.
MLCC makers are shifting their strategies to meet demand, according to Fusion’s GreenSheet released last week. Samsung is focusing more on larger case size (1206 and 1210) production, while Murata is shifting to smaller packages (0201 and 0402). Murata, meanwhile, is increasing production on smaller case size and high-value MLCCs, hoping to serve the growing automotive industry.
Second tier suppliers are also trying to leverage shortages to gain a better foothold in the market. In recent weeks, Yageo distributors in China released close to 200M units of MLCCs at exceptionally low pricing, Fusion told EBN. “The cause for this inventory clearing is Yageo’s 2018 price-bidding program, where they pin distributors against one another to prioritize allocations,” the Greensheet said. “This practice left many distributors fuming, and as such, they are looking to boycott the brand entirely to save themselves from a repeat in 2019.”
While still in short supply, MOSFET supply may be recovering some. “Many distributors are still not receiving allocations from the manufacturer; some are desperately purchasing parts from OEM and open market sources in order to fulfill customer orders,” the Greensheet reported. At the same time, hopeful signs can be seen. Infineon is expected to decrease pricing by the end of Q1 2019 and On Semi lead times have begun to recover relative to Q3 2018. “There are still a few parts under severe allocation, especially customized components belonging to niche products, but common parts are seeing gradual improvements with lead times reducing from 40+ weeks to 20 weeks,” Fusion said.
Automotive parts are still in short supply. For IGBT automotive modules, lead times remain extended closer to 40 to 50+ weeks. This can be traced to increasing demand for newer technologies, such as hybrid and electric vehicles, as well as limited raw materials for component production.
Telecomm industry demand growth is also shifting market dynamics. TE Connectivity relays have been on allocation since last year and products are shipping directly to large customers. Meanwhile, small to mid-sized businesses are having trouble getting the products they need. “TE couldn’t keep up with the overwhelming volume of orders, which far exceeded forecasted demand, and a year later the situation has only worsened,” Fusion said.
The infographic below from Fusion Worldwide illustrates some of the other market trends at play. Take a look and let us know what you think in the comments section below.