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Chip shortage: Toyota to cut global production by 40%

bbc.com

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Re: Chip shortage: Toyota to cut global production by 40%

#491

Post by thedougd »

dave_sullivan wrote: post #470
jvanderbot wrote: post #417

Earlier quoted context omitted.

How much would it cost to set up TSMC inside US borders? One president cycle? 4 F-35s? One SLS? A nuclear submarine? According to this page, sorting by cost, https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat... the most expensive fab is 33 Giga$. TSMC is 17G$. pennies on the dollar in our 1-3Trillion infrastructure bill. Make america fab again. EDIT: it appears this is in the 2T infrastructure bill. https:…

Government can't make a website, let alone a chip fab. Talk to Intel and ask them why we've fallen behind. Do any VCs want to fund a direct Intel competitor? I doubt it. Making chips seems to be quite a bit more complicated than making and launching rockets, I don't think even Elon Musk could do it.

The 18F group is more than capable: https://github.com/18F

Re: Chip shortage: Toyota to cut global production by 40%

#492

Post by s1artibartfast »

varispeed wrote: post #360
mathattack wrote: post #297

Earlier quoted context omitted.

Just the opposite. Need to let people raise prices to encourage slack in the system. Let’s prices settle where chip makers can produce new chips. There are market failures where the government needs to step in, but this isn’t one. Even with climate change (where they should step in) the government can’t get to the point of saying it’s ok for gas prices to be high. We don’t want the government to pick winners and lose…

> Need to let people raise prices to encourage slack in the system. The scalpers can absorb the rising prices until the desperate companies no longer can afford the increase. That will cause the market crash, which is not good for anyone. I think government should regulate that space so that businesses engaged in scalping could no longer purchase nor sell the chips.

>The scalpers can absorb the rising prices until the desperate companies no longer can afford the increase

The whole point is for manufacturers to raise the price until desperate companies/consumers can no longer afford it and don't buy them. Im not sure where scalpers come in. If prices are set high enough, scalpers can't make a profit.

Re: Chip shortage: Toyota to cut global production by 40%

#493

Post by hencq »

Jtsummers wrote: post #284
throwaway0a5e wrote: post #235

Earlier quoted context omitted.

It should go without saying that there are nuances in implementation. What I'm describing here is a fundamental tradeoff of JIT systems. If you get the wrong thing delivered it throws a bigger wrench into things because you don't have the buffer. Can you make this rare enough that the amortized cost is low enough to make JIT overall cheaper? Of course, that's why everyone does JIT.

> If you get the wrong thing delivered it throws a bigger wrench into things because you don't have the buffer. JIT, in Lean, does not mean no buffer, it means as little of a buffer as you can get away with. If you have issues with delivery like this on a regular basis, then you'd increase the buffer size (at least temporarily) and also take your suppliers to task for sending the wrong thing over and over. The buffer…

> JIT, in Lean, does not mean no buffer, it means as little of a buffer as you can get away with.

Yeah, spot on. One of my college professors used to compare it to a river with rocks in it. If you want to safely sail on the river, you can either a) keep the water level high enough or b) remove the rocks. In a production system inventories/buffers are the water level and variance is the rocks. The philosophy of JIT is to remove as much variance from your system as possible so you can lower your buffers. If you have identified areas of high variance you're forced to keep buffers until you've removed enough variance to lower your buffers.

Re: Chip shortage: Toyota to cut global production by 40%

#494

Post by jvanderbot »

zsmi wrote: post #490
jvanderbot wrote: post #484

Earlier quoted context omitted.

Just subsidize it. I'm not asking for the Fab Czar, I'm asking for the NSF, DARPA, and national subsidies for it. Accelerated permitting, tax breaks, tarif support, state vs national investments, accelerated green cards for key personnel, and price breaks for a "buy US Chips" initiative for the first 5 years until things get serious and exports ramp up. I'm spitballing over morning coffee, but come on, this seems obv…

Will this do? https://www.eetimes.com/biden-ups-ante-to-50-billion-for-chi...

Yes. That's precisely what I'm asking for.

Re: Chip shortage: Toyota to cut global production by 40%

#495

Post by s1artibartfast »

nicoburns wrote: post #326
mathattack wrote: post #297

Earlier quoted context omitted.

Just the opposite. Need to let people raise prices to encourage slack in the system. Let’s prices settle where chip makers can produce new chips. There are market failures where the government needs to step in, but this isn’t one. Even with climate change (where they should step in) the government can’t get to the point of saying it’s ok for gas prices to be high. We don’t want the government to pick winners and lose…

What makes you think the most critical uses have the most money to pay for chips? I'd imagine there's a lot of crappy (or in any case not critical) consumer products that have much higher margins.

IF the use is critical, then the user should be willing to pay more. If they can't, I would want to look into why and question how critical they are.

Re: Chip shortage: Toyota to cut global production by 40%

#496

Post by zsmi »

dylan604 wrote: post #455
mywittyname wrote: post #418

Earlier quoted context omitted.

Yes. One scary fact that I learned is that, in war games between China and the USA, China almost always wins due to superior production capacity. Those $100B American battle carriers and $40MM advanced fighter jets can be taken out by $50,000 rockets/missiles produced at a rate of hundreds or thousands per day.

How many tomahawks does it take to destory these factories?

Probably not too many. But I wonder, are there more Chinese factories or Tomahawk missiles? I'm not totally sure. China is a very large country.

Re: Chip shortage: Toyota to cut global production by 40%

#497

Post by jbay808 »

mindslight wrote: post #430
verdverm wrote: post #401

Earlier quoted context omitted.

> You're assuming that increased profit margins will automatically increase supply chain buffers. I read GP's comment as increase prices to decrease hoarding, which in theory could provide the slack in the system. Problem might be that certain products may not be viable if prices get too high. Only those with sufficient margins prior.

I don't see that raising prices would make consuming companies want to stock up less. A company that requires an input to manufacturing is going to have a pretty steep price-demand curve for every individual component. Even if prices for one of their scarce inputs doubles, they're still going to buy as much as they can rather than risk shutting down their entire production if they run out. Since their competitors are…

> they'll just raise their own prices to compensate.

That's how it works in econ 101, but not necessarily in practice. Prices on many goods are less flexible than commodities like oil and lumber, for many reasons. Manufacturers may be locked into fixed-price contracts or distribution agreements, for example. Or a scarce component might be shared across "budget" and "premium" product lines, but the budget line is too price sensitive to change so the premium product goes up 10x instead. Or the company just borrows money and eats the loss...

Re: Chip shortage: Toyota to cut global production by 40%

#498

Post by saltcured »

throwawaygh wrote: post #411
QuarterReptile wrote: post #367

Earlier quoted context omitted.

No, still positive. Negative feedback is self-righting, while positive feedback is amplification (to speak in very broad terms.)

No! It's negative WRT chip production rate! I have a phd in controls and meant what I said; I assume roboticsresearcher also knows some freshman-level control theory ;-). Stability ==== good in undergrad engineering, but not here. We DON'T want production rate to be stable when we have a global supply shortage! Here, a negative feedback loop is stabilizing the system in an undesirable equilibrium. I.e., the function…

Only partially facetious here: you have mistakenly decided that it it clamps at zero. If we consider the hoarding aspects, the feedback continues into net negative chip availability. Before long, there will be roving gangs of looters taking back the chips you thought you already had! ;-)

Re: Chip shortage: Toyota to cut global production by 40%

#499

Post by alfalfasprout »

jvanderbot wrote: post #417
Scoundreller wrote: post #328

Many countries have a funny concept of strategic industries. In mine, dairy is a strategic industry that is coddled by government so that we can have a local source. But every country thinks that so there’s foes and allies that can supply us UHT or powder milk on a moment’s notice. And if our milk supply disappeared tomorrow, everyone over 1y could substitute with 10000000 different things for nutrition. Cars are ano…

How much would it cost to set up TSMC inside US borders? One president cycle? 4 F-35s? One SLS? A nuclear submarine? According to this page, sorting by cost, https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat... the most expensive fab is 33 Giga$. TSMC is 17G$. pennies on the dollar in our 1-3Trillion infrastructure bill. Make america fab again. EDIT: it appears this is in the 2T infrastructure bill. https:…

We're doing it but obviously Taiwan isn't going to give up their smallest die processes (only older processes) since it keeps the US at least unofficially allied with them.

Re: Chip shortage: Toyota to cut global production by 40%

#500

Post by theandrewbailey »

dheera wrote: post #473
jvanderbot wrote: post #417

Earlier quoted context omitted.

How much would it cost to set up TSMC inside US borders? One president cycle? 4 F-35s? One SLS? A nuclear submarine? According to this page, sorting by cost, https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat... the most expensive fab is 33 Giga$. TSMC is 17G$. pennies on the dollar in our 1-3Trillion infrastructure bill. Make america fab again. EDIT: it appears this is in the 2T infrastructure bill. https:…

Cost isn't the issue, it's that we have incompetent buffoons as presidents these days. https://www.youtube.com/watch?v=TuW4oGKzVKc That's what a president sounds like.

It's not just incompetent presidents, it's incompetent politicians at every level.
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