Acer Warns Chip Shortage Will Impact Laptop Production

Acer has become the latest tech firm to warn of the impact the global chip shortage is having on its operations.

Taiwan-based Acer is the sixth largest PC maker in the world, and a senior executive at the firm has warned of price rises and limited production of laptops until at least next year.

And Acer is not alone in these warnings. Last month Michael Dell, the CEO and founder of Dell Technologies, the world’s third largest personal computer vendor, warned the chip shortage is not going away soon, and may take a number of years to resolve.

Production issues

Acer now added its voice to these warnings, after co-chief operating officer Tiffany Huang last week told the Guardian Australia that device prices may rise, and on any given day Acer can only fill half of worldwide demand.

She said the worldwide global chip shortage will continue to have a “severe” impact on its production capabilities until at least the first or second quarter of next year.

“It will continue to be slow until the first quarter or second quarter of next year,” she reportedly said, adding that the pandemic had been fuelling the shortage with so many people working from home. “We have a severe shortage, and it’s not simply just to make sure every family has a device to use, every person has to have a device for working or education.

“On any day I can only fill 50 percent of the worldwide demand, she added.

Huang reportedly said that had forced the company to put more resources into its education product portfolio, over its growing gaming portfolio.

“We shipped millions of education devices last year [and] this year. That is simply because we believe people really deserve a right to be able to continue their living and learning.”

Analyst warnings

Acer is right to be concerned.

Forrester Research recently warned it expects the chip supply issues to extend through next year and into 2023.

And Gartner in its latest report reportedly estimated that the shortage would continue until at least the second quarter of 2022, with prices for some devices to increase as a result.

“We are at the most serious shortage, or the tip, right now,” Gartner’s senior principal analyst on semi-conductors, Ben Lee reportedly said. “For some different components, they have had prices rise in the past two or three quarters.

“It means the customer has to pay more because there aren’t as many items, especially hot items like mobile PC, and tablets to some extent,” Lee added.

Ongoing shortage

The chip shortage is the result of a perfect storm of events, namely increased demand for electronic devices due to people being housebound during the Coronavirus pandemic, as well as US sanctions against Chinese tech firms, and a severe drought in Taiwan which is also hampering production.

This chip shortage has hurt multiple industries including car and electronic makers.

The US is seeking to build more chip factories, create a White House “chief manufacturing officer” to help prioritise America’s manufacturing base.

It should be remembered that US President Joe Biden has already signed an executive order back in February to tackle a number of pressing shortages for four critical products.

That included semiconductor chips, electric vehicle batteries and rare earth minerals.

President Biden also announced he would seek $37 billion in funding to ‘supercharge’ chip manufacturing in the United States, and try to lessen its reliance on chip manufacturing in Asian factories.