January 30, 2023

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5 Biggest Challenges in Semiconductor Industry Supplier

Semiconductor Industry Supplier

Semiconductor Industry Supplier

Semiconductors are the building blocks of electronic devices. They have changed the world of electronics completely. Electronics have become compact and handy because of this innovation. It is the basis of all electronics; therefore, all electronics companies want to have a sufficient supply of silicon. In the current times, semiconductor industry supplier is facing big challenges. It is difficult to extract and purify.

Moreover, because of the trade war between different countries, the availability of silicon semiconductors is facing serious troubles. Besides these, the increasing demand from the Smartphone industry along with innovative artificial intelligence (AI) and the Internet of Things (IoT) is posing serious challenges to the supply of semiconductors.

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To make things concise and easy for you, we have put together all information about challenges in the semiconductor industry. In this blog, we have discussed five major challenges faced by the industry.

Let’s look

1.      Innovations in Automation Affect Semiconductor Industry Supplier

Currently, all semiconductor manufacturers are making silicon chips with a diameter of 7 nanometers. However, the gadgets are getting smaller and more compact. Therefore, the new requirement for electronic devices is 5nm or even less than 3nm. The production of these chips requires new substrates and manufacturing units. In the absence of a new manufacturing unit, the demand cannot fulfill existing production of smaller chips. The wafer production is also less because of the effects of electrostatic and quantum. These tend to affect the performance of chips as well.

AI can take care of these imperfections and anomalies in silicon substrate so that they can remain useable. Manual production does not ensure that new chips will not have anomalies.

2.      Recycling Semiconductors Is Hazardous

It is always a good practice to recycle products and reuse those components that can use. Once you recycle a product containing semiconductors such as Smartphones, the resulting materials are silver, copper, gold, palladium, and so on. However, the resulting materials are not always economically valuable. If you wish to obtain valuable material through recycling, that is a heavily expensive project. Other than being too costly, recycling semiconductor products produce a lot of toxic waste. This is highly detrimental to human health. In those regions where children also exposed to recycling smartphones, children’s health remains at stake.

Furthermore, recycling has another consequence. It affects the environment and contributes to pollution. Therefore, recycling semiconductor is too risky of a job. Semiconductor industry supplier often struggle with this challenge to find a viable solution.

3.      The trade war between different countries

The clash between two titans over semiconductors is another challenge the silicon industry is facing. The major producers of semiconductors, China and the USA have other bones of contention i-e semiconductors. The USA has imposed tariffs on Chinese imports including semiconductors. This has led to the increased cost of semiconductors. If the situation prevails, expected that China will halt the supply of semiconductors to the US. This will impact the electronics industry generally and the Smartphone industry particularly.

If the tariff imposition continues, it will have drastic impacts on Chinese economic growth and activity. As major Smartphone companies such as Apple have outsourced manufacturing to China, it is obvious that Asian countries will also retort. Furthermore, the prices of imports will also rise in the USA because of tariffs imposed on semiconductor-based items.  This tends to discourage a lot of Semiconductor industry suppliers.

4.      Investing outside automation

Automation is a highly desirable aspect of semiconductor production. Since wafer production is a tricky task and requires too much accuracy along with precision, not recommended to leave wafer processing to manual handling.

Automation improves ROI (Return on Investment) because, with accuracy and precision, you can get consistent silicon wafers. This means the semiconductors will have greater productivity and results, and less waste. Because of such promising results, more and more manufacturing companies are opting for automation and artificial intelligence systems to monitor the manufacturing of semiconductors.

Since automation ensures the accuracy and precision of silicon wafers, the resulting products are highly reliable. As the element of human error is subtracted from the whole process, there are no delays and no compromises on the quality of chips. Human involvement during handling, transportation, and other stages can lead to errors or mistakes. Other than this human involvement can compromise the quality of wafers because human touch can contaminate wafers.

Considering all these factors, we can safely conclude that automation is important for manufacturing high-quality and reliable wafers and all Semiconductor industry suppliers struggle with this dilemma.

However, this is not all because you need artificial intelligence to remove any bottlenecks in production. Besides an intelligent system, you cannot subtract human involvement from manufacturing high-quality and reliable silicon chips. Although automation is a must-have, investing in human resources and artificial intelligence is equally important because they keep a system running.

As more and more companies are only focused on automation, they tend to overlook investing in humans. Without intelligent supervision and timely decision-making, the process is bound to experience bottlenecks and delays.

5.      Demand/Supply Imbalance

Silicon chip making is a demanding and exacting task. It requires the utmost caution and the right procedures to make high-quality silicon chips.

The number of industries that need powerful chips is increasing. Moreover, their demands are also becoming tricky and difficult to fulfill. All industries want powerful chips at the minimum possible size, available at an affordable cost. This is something challenging because high-performance chips require a delivery time of at least 28 weeks.

The extraction and purification method of silicon is difficult as well as demanding. It requires time and resources. Due to the time required for purifying silicon, the supply of semiconductors can suffer. Even when pure silicon is acquired, Semiconductor industry suppliers struggle with marketing and other aspects of semiconductor supply.

Final word

Semiconductors are the basis for modern technology. The fact that giant machines have become handy and compact is only because of the availability of semiconductors. The demand for silicon chips is increasing significantly. However, the Semiconductor industry suppliers are facing several challenges. From supply/demand imbalance to automation reliance; there is a lot that is affecting this industry.

To improve the electronics industry, and to improve the quality of products, it is important to remove all these bottlenecks so that companies can have their required quantity of silicon chips. High-quality chips available in sufficient quantity will bring revolution in the world of electronics.

Austin Seal is a reputable and reliable Semiconductor Industry Supplier. Other than manufacturing high-performance silicon wafers, we are also known as the best Parker Seal Supplier in town. To know more about our products and services, visit our website or talk to our representative.