Companies from Apple Inc. to Ford Motor Co. have complained that they can’t meet demand for their own products and that their costs are rising. October’s more muted increase had fueled optimism that the situation was improving.
The lead times — a closely watched gap between when a semiconductor is ordered and when it’s delivered — increased by four days to about 22.3 weeks last month compared with October, according to research by Susquehanna Financial Group. That lag marks the longest wait time since the firm began tracking the data in 2017.
The results are a setback for industries that need more of the electronic components. Companies from Apple Inc. to Ford Motor Co. have complained that they can’t meet demand for their own products and that their costs are rising. October’s more muted increase had fueled optimism that the situation was improving.
“While the expansion is less than most months of late, we had hoped for a clear reversal,” Susquehanna analyst Chris Rolland said in a research note.
Power-management chips and microcontrollers in particular saw large increases, he said. But no category of chips tracked escaped an increase. His checks suggest that “supply pressure will remain well into 2022” for many products.
Rolland also said he’s changing his methodology for the survey and adding more data sources. Using the new method, lead times are over 25 weeks on average.
Semiconductor shortages have hampered recovery from the Covid-19 pandemic, particularly for carmakers. AlixPartners, a global consulting firm, estimated that the global automotive industry will lose more than $200 billion in sales this year.
In the past, lengthening lead times have been followed by painful periods of oversupply. The concern is that customers are purchasing more than they need right now — so-called double ordering — and then will later cancel the requests.
For now, the shortages have been a boon to many chipmakers. The Philadelphia Stock Exchange Semiconductor Index is up more than 40% this year, outgaining the S&P 500 Index.