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The global chip shortage is starting to have consequences

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Re: The global chip shortage is starting to have consequences

#371

Post by salawat »

robomartin wrote: post #285
neltnerb wrote: post #193

Earlier quoted context omitted.

I get that this is a potential big problem, but I had to stop reading when the dog washing company blamed needing to respin a new board on a chip being out of stock due to this. I'm sorry, but if you aren't buying enough chips to build all the boards you want to build of a revision, this is just what happens, chip shortage or no. Stuff gets obsoleted all the time, it doesn't take a chip shortage. Blaming a black swan…

> I had to stop reading when the dog washing company blamed needing to respin a new board on a chip being out of stock due to this ... > if you aren't buying enough chips to build all the boards you want to build of a revision Friendly advice: If you are going to be a consultant to industry, don't post comments like this. As someone who has been manufacturing tech products for over thirty years, my first reaction to…

Thank you for sharing that. One of the biggest laments I've run into trying to help someone get businesses bootstrapped is some of the very lessons you just shared.

That sharing is so damn rare, and I think a lot of people end up in a really bad place because we don't do a great job at teaching the failure states of business.

So again, thank you. Life willing, you sound like someone I'd be thrilled to do business with.

Re: The global chip shortage is starting to have consequences

#372

Post by f6v »

honkycat wrote: post #364

I've eyeing a gaming PC for a while. I game, do music production, amd also do i die game dev. If I buy an all in one I'll pay a $500 premium but I'll be able to actually acquire all the components. Hackernews, please tell me: should I pull the trigger before it's too late, or hold off for the panic to subside?

I’d join the secret laptop club if I was in the us https://youtu.be/cFyka8Vp62Y

Re: The global chip shortage is starting to have consequences

#373

Post by im_down_w_otp »

devit wrote: post #332
robomartin wrote: post #302

Earlier quoted context omitted.

As I finished writing that comment (and I truly tried to be constructive as the author is young and inexperienced) I remembered another traumatic event of that era. Every order we received was like precious molecules of much needed oxygen. We got this order from one of our resellers (we had about fifty all over the world at the time) for about half a million dollars in product. This needs to be in the right context:…

Maybe the real lesson of the whole thread is to require customers to pay in advance with a non-reversible wire transfer, or at least via an escrow service contingent on delivering the goods. Or alternatively, somehow buy insurance against the customer failing to pay.

There are an enormous number of marketplace norms which prevent being able to make demands on a customer like that. If you're the only vendor trying to protect your downside like that, then you look like a bad vendor, and it can affect your ability to close the deal at all. Especially in enterprise/B2B markets there's an amount of ceremony and playing of the game required, not because it's actually good for any of the parties involved, but because it's just the thing everybody does, so you have to do it too.

For example, we sell into markets like automotive, aerospace, and medical. Being a startup we have basically zero leverage in how to go about conducting business with large well entrenched enterprises with business development dynamics that were calcified decades ago. Part of managing my business is accepting and working with the risk profile of having to keep the company solvent long enough to actually engage these customers in the ways they're able to be engaged. I'm not going to be in a position to make demands that they conduct business significantly differently with us relative to their hundreds of other vendors regardless of if it would ultimately benefit both of us to do so. There's an amount of inertia in any status quo that needs to be overcome, and the problem with that is that the party with the most motivation to displace that inertia is also the one with the least power to do so. That reality gets baked into our capitalization and operations strategy.

I'd love to be able to demand that automotive OEMs actually cover the cost of engaging in a PoC with them which isn't going to have any real payoff for months or years, but every single other supplier they have eats that cost just like we do, and betting my company on the incredibly low probability that I'm going to displace the pandering that they expect from their supply-chain all by ourselves would be crazy.

Re: The global chip shortage is starting to have consequences

#374

Post by baq »

oblak wrote: post #181

So, even though Intel has been incredibly profitable for many years, they Gelsinger is asking for US and EU government support because... uh, uncertain times? That it? How much did they ask Isreal for this 600 million investment? [0] [0] https://www.israel21c.org/intel-announces-600-million-boost-... The EU should invest in AMD and build fabs without Intel if we are to be "independent"

starting a fab business from scratch to something like current 7-5nm nodes is a multi-decade, likely high multiples of 10B€ endeavor. while I agree having such capacity is a matter of EU security, paying Intel and TSMC to build their fabs on EU ground in ~2 years for less money is an attractive proposition and not mutually exclusive with the former to boot.

Re: The global chip shortage is starting to have consequences

#375

Post by baybal2 »

noahtallen wrote: post #330
baybal2 wrote: post #235

Earlier quoted context omitted.

The industry has largely forgotten how to make stuff without chips. That's why I am telling people that a global chip shortage, if something happens to Taiwan, would bring the industry not back into fifties, but into the iron age. The further the tech ladder you go, the harder you fall if somebody takes out your engineering bay.

I don’t think that would happen. Firstly, the US government and army (like it or not) has an interest in not falling behind technologically. Additionally, Intel has most of its fabs in the US already. Samsung and TSMC are currently building fabs in the US too. Finally, the US still has a strong tech culture. So I think it would not take long with an increased demand (and higher salaries) for computer engineers to att…

No Intel fab will run more than a few weeks without consumables coming from Asia. A giant lot of semi supplies are single vendor globally, and much of them are in Taiwan.

It's likely that no fab in the West past the I-line era will be able to resume, and continue production with local supplies, even with immediate nation-state level effort to recreate the supply chain.

Re: The global chip shortage is starting to have consequences

#376

Post by baq »

isbvhodnvemrwvn wrote: post #151
perardi wrote: post #97

Earlier quoted context omitted.

TVs are Netflix terminals. Why not get a TV with Netflix built in? At this point, it just makes sense to have apps on the TV.

When the software is no longer supported you have an expensive security vulnerability hanging on your wall.

this is true for all appliances with any sort of networking. an appletv, roku, chromecast or fire stick have the exact same concern.

Re: The global chip shortage is starting to have consequences

#377

Post by formerly_proven »

chrisseaton wrote: post #293
heisenbit wrote: post #243

Earlier quoted context omitted.

0% loan on the sticker price. The goal of coming in with cash is to get as far as possible below the sticker price.

This is a really common misconception that buyers have. Just stop and think for a second - put yourself in the dealer's shoes - why do you think the dealer would want cash? No reason. They don't want your cash. A cash buyer is a pain. They want to sell you a loan. The last time I bought a car I offered cash, and they countered with a four-figure discount (on total cost of ownership) if I took part of it as a loan. I…

> Cash buyers are fools, unless you're really at the point of valuing not having a loan for moral reasons (maybe a German?) at four-figures.

German Ideal nowadays is to buy a house for a couple hundred grand on a loan that you finish paying off when retiring.

Re: The global chip shortage is starting to have consequences

#378

Post by ineedasername »

pfranz wrote: post #312
ineedasername wrote: post #250

Earlier quoted context omitted.

Carvana etc are not full service though. You can't go test drive in advance. Also, dealerships are tightly linked to manufacturers, very similar to other franchises, and the incentives are in the manufacturers' favor for the existing model: there's relatively little profit, especially considering the overhead, in selling the car itself. The profit center is in servicing the cars at the dealership service center: The…

I've never heard of Carvana, but test drives aren't something we should need dealerships for. Having 1 or 2 cars of each is all you need. Technically a low-end model would be fine, but I can see them only offering the highest end model to upsell features. Then you do what brick-and-mortars have complained about for years and order exactly what you want online. Personally, I think renting a car for a medium term is wa…

I'm not saying things couldn't work differently, only that the incentives don't align to make that very easy to accomplish. Tesla did it because they had the advantage of looking at the current status quo and saying "Yeah, no thanks, we'll retain control of whole process."

I get what you mean about certain aspects, but I would not describe the process of buying a car in that way.

I don't know what you mean. I don't think I said much about the hassle of buying a car: I agree with you on that. When I say "service is the key" I mean mechanically servicing the car, not customer service.

I also wouldn't contradict you on the test drive idea, but that's almost exactly how dealerships do it already. Unless you really insist on driving the exact car you're buying, they are going to direct you towards the demo car reserved for that purpose.

Repair shops: Yes they can exist outside of dealerships, but manufacturers can't build their own service centers without bankrupting the dealerships, which is how they get sales in the first place. Dealerships do occasionally flip to another manufacturer if the local market for their cars is bad, and they would do that in a heart beat if the manufacturer opened its own independent service center nearby.

I completely agree that better models for all of this could exist, but, as you said, the intertwining factors are a real rats nest. This is why I'm extremely skeptical when someone claims everything will be different in 20 years. Breaking this rats nest requires some type of black swan event. By definition those are mostly unforeseeable, and I don't see anything right now to change things. Carvana and those like it focus on used cars, which have always been much more decoupled from the manufacturer/dealership relationship already.

As a final side note, you can avoid the 4-hour dealership visit pretty easily these days: My wife just needed a new car, and we worked with their online sales person via email, casually going back & forth 2 or 3 times over the course of a discussing options and hammering out the details. Trade-in value was determined by giving them the VIN # and pictures of the car. When we went in to pick up the car, all we had to do was review the details. There was a little bit of wait for the insurance company to put the car on our policy (they can't do that until the transaction is official) and for the finance officer to be available, after which we reviewed the paper work, signed, and were done. The whole process took under an hour.

Re: The global chip shortage is starting to have consequences

#379

Post by giobox »

giaour wrote: post #268
heisenbit wrote: post #243

Earlier quoted context omitted.

0% loan on the sticker price. The goal of coming in with cash is to get as far as possible below the sticker price.

Don’t dealerships make a good percentage of their profits from finance charges? The last time I bought a car, it took an hour of cajoling to get the cash price of a three year lease

Absolutely. To take Ford as an example, It’s not that huge an exaggeration to suggest Ford manufactured cars with virtually no profit margin to help sell profitable loans via its Ford Credit arm at various times in its recent history, rather than providing loans to help sell the cars at profit. Ford Credit is a huge part of Ford’ overall business.

Re: The global chip shortage is starting to have consequences

#380

Post by neltnerb »

crote wrote: post #267
neltnerb wrote: post #193

Earlier quoted context omitted.

I get that this is a potential big problem, but I had to stop reading when the dog washing company blamed needing to respin a new board on a chip being out of stock due to this. I'm sorry, but if you aren't buying enough chips to build all the boards you want to build of a revision, this is just what happens, chip shortage or no. Stuff gets obsoleted all the time, it doesn't take a chip shortage. Blaming a black swan…

I'm very loosely involved in the highly customized keyboard business, think runs of a couple hundred units. One vendor is having trouble finding any chip to design for. The software stack supports a couple of dozen STM32 chip series, but none of them are even remotely available. I've seen a lead time of over 11 months. Before COVID, pretty much every single chip was in stock almost all of the time. Respinning a board…

I don't doubt it, in the article the dog washing company specifically said that their design firm already had a solution that just required new PCBs.

That is not sympathetic, that's very normal.

What you're describing is sympathetic and hard to deal with. Their example was lucky about it and still ended up somehow quoted in the story.

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