Intel: Semiconductor supply and demand tensions will take years to resolve

Intel CEO Pat Gelsinger said yesterday (31st) that the semiconductor industry has taken action to address short-term supply and demand constraints, but it may still take several years for the supply chain to resolve the shortage.

The one-month 2021 Taipei International Computer Show (COMPUTEX 2021 Virtual) online exhibition kicked off yesterday. Intel was invited to give the opening keynote speech, which was hosted by Executive Vice President Michelle Johnston. Although Kissinger was not the main speaker, he also appeared via video.

Kissinger emphasized that he likes the phrase "unleashing innovation", which can well explain the spirit and strategy of the industry and Intel in these new days. There are currently four key super forces driving the global digital transformation, including cloud, 5G connectivity, artificial intelligence and smart edge devices.

Kissinger pointed out that the trend of working from home and online learning during the epidemic has led to an explosive growth cycle in the semiconductor industry and has also brought huge pressure to the global supply chain. Intel has cooperated with many partners to increase production to meet market demand and take actions to promote production capacity to meet the needs of various new fields around the world. For example, the company has doubled its internal production capacity in the past four years.

Kissinger specifically mentioned the ecosystem partners in Taiwan. He has many memories of visiting Taipei, including participating in activities such as the Intel Developer Forum. He also thanked the ecosystem in Taiwan for playing a key role in facing the challenges in the industry today. The company works closely with ODMs, OEMs, wafer foundries, and packaging and testing plants in Taiwan to ensure continued investment in the right areas to alleviate bottlenecks in the future supply chain.

Kissinger emphasized that Intel has unparalleled mass production advantages in software, silicon chips and platforms, packaging and processes, and its integrated device manufacturer (IDM) model can effectively and dynamically respond to market demand. The company has invested more than US$20 billion to increase the production capacity of its Arizona plant and the advanced semiconductor manufacturing technology of its New Mexico plant, and will expand its plant to other parts of the United States and the European market to ensure that the global semiconductor supply chain can obtain sustainable and secure production capacity supply.

Kissinger recently announced Intel's "IDM 2.0" strategy, which includes three major directions. First, it will continue to produce most products internally and expand the production capacity of its own wafer fabs. Second, it plans to expand the provision of wafer foundry services. Third, it plans to expand the use of third-party wafer foundry capacity.