Apple lost $6 billion due to chip shortages, and experts predict a “train wreck”

My unenlightened ego loves it when news confirm my confirmation bias. CNBC:

Apple chip shortage will end, but U.S.-China supply chain ‘train wreck’ is coming

“Apple said on Thursday it lost the equivalent of $6 billion in sales due to chip shortages.” (…)

“The current commercial issues causing the supply chain shortages will end, but “what frightens me the most is the geopolitical … the politics of this is just getting starting in Washington and Beijing,” Dewardric McNeal, managing director and senior policy analyst at Longview Global, who worked for the Secretary of Defense on East Asia and China security relations during the Obama administration, said at a recent CNBC Technology Executive Council Town Hall.” (…)

“”Telling me how to allocate is bad for a chip CEO. Telling me where I need to locate is bad. So I’m concerned we have a real train wreck coming even when we got beyond some of the short-term stuff,” McNeal said. “The man-made stuff, the political stuff, I don’t know if industry is quite prepared to really understand how bad it is going to get between Washington and Beijing.” (…)

” … The Biden administration has “doubled down” on the policies of the prior administration, he said.”

“”If there is only one thing Congress and government officials can agree on … it’s China,” Murphy said. “If Huawei is the preamble for what’s to come, it’s additional risks.”” (…)

“”We need a company like TSMC [Taiwan Semiconductor Manufacturing Company] in Arizona times ten, and many more in the U.S. if we want security from interruption,” Frichtl said.”

“In addition to the national security risks, he said there is simply too much geographic concentration of the world’s most advanced fabs in Asia, and a single calamity could take them out. …”

“”In the event of a flood or earthquake and we could fall back into this issue. … I would argue this has demonstrated to the world that there’s this thing [semiconductor manufacturing] that’s really important to the functioning of the most valuable businesses, like Apple, which has to get semis to make phones, and if we don’t create policy around ensuring day to day supply that can absorb minor shocks we will be in this situation again. We are having a shortage now, but it could be no new chips and that would be catastrophic,” Frichtl said.”

“McNeal said the concepts being weighed including technology sovereignty and near-shoring outlined in legislation like the $50 billion CHIPS Act are part of the process of industry and government understanding expectations and level-setting, but he isn’t convinced that everyone is on the same page domestically, or globally with allies in Europe and southeastern Asia when it comes to coalescing around a rebalancing of supply chains. “I am not so sure our European and ASEAN friends are really fully on board, not sure how to really navigate the geopolitics of the supply chain,” he said.”

But the butterfly effect would not have been nearly as exciting if external threats were not combined with a domestic culture war in the West. Ignorant CEOs keep pouring wokeness on the fire instead of uniting the nation like China and Russia do. Nationalism is anathema in the hippie libertine corporate West today, so expect more cerebral divertissement in the culture war. Yay 🙂

Oh, by the way, militant activists and dictators notice news like:

“Apple said on Thursday it lost the equivalent of $6 billion in sales due to chip shortages.”

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