The President of Hisense told CNBC The chip shortage might continue worldwide for another three years before ending.
Various industries, including customer electronics companies and automakers, are struggling with a deficit of semiconductors. This situation has led to a shortage of manufacturers and game consoles striving to keep up with demand.
Companies and their decisions
Chinese tech companies and electric carmakers are also experiencing the squeeze.
A Chinese state-backed TVs and household appliances maker, Hisense, has experienced some impact as well. President of the Qingdao-based company, Jia Shaoqian, said the production expenses for its products have increased while the business remains almost the same.
According to a CNBC translation, Jia said that Hisense requires simple chips to make consumer goods and home appliances. Although after tightening the supply, the cost has grown higher, while their business remained normal.
According to Jia, China imports most chips and manufactures final products there before exporting. The U.S. and China started a trade war during the Trump presidency, and those business tensions around semiconductors remain the same. Finally, the U.S. decided to remove SMIC (China’s biggest chipmaker) from U.S. technology.
Many factors affected the chip shortage. One of the reasons can be an increase in demand for customer electronics during lockdowns worldwide after the covid pandemic started. This trade war between the two nations led to companies accumulating and storing supplies.
According to Jia, after global trade discussions, the chip shortage could continue for three more years.
Jia said that if sanctions between China and the U.S. continue, it would be harder to estimate.
The U.S. and Europe expansion
Hisense might not seem popular to many customers, but it tried to boost its brand in the past few years.
The company sponsored World Cup soccer and the Euro 2020 tournaments while expanding more outside of China.
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