Over the past year the supply of electronic components has still not managed to reach a point where it can meet the increases in demand that have occurred over the past few years. Are we getting any closer to having a supply situation that will allow acceptable product lead-times to be achieved?
The problem has been exacerbated by assembly companies both forward and double ordering stock. After being caught out in past recessions, distributors do not hold the stock levels they used to, so there is a high dependence on the component manufacturers.
The extremely unusual aspect of the present problem is that there are shortages of what are regarded as basic items, such as capacitors and resistors, as well as the more non-standard items, such as integrated circuits.
AGW have noticed the problem with the supply of ferrite and iron powder cores for the transformer and inductor coil manufacture. A quotation of 26 weeks lead-time is not unusual and the quotation of lead-times of over a year have been received.
The main reason that is given for the demand is the dramatic movement in the automotive industry towards the manufacture of electric vehicles and the new supporting infrastructure that is required.
Is 2019 going to show an easing of the situation?
The messages are mixed. Some component manufacturing companies have invested to increase their resources. This is good news, but it will take time for these resources to come on-line, so the benefits may not be felt until the latter half of the year. The good news for AGW is that Ferroxcube, the ferrite core manufacturer that we partner with for our components, is one of the investors. In other market areas, there is not such good news. There is still a huge problem with ceramic capacitors. At present, manufacturers are not accepting any further orders for 2019.
Where and when possible, bearing in mind changes to specifications and adherence the standards and approvals, AGW source available alternatives. AGW’s ability to provide prototypes quickly has allowed the approval of alternatives to happen quickly.
Let’s hope the on-going demand for components continues, but that more resources come into place during 2019 to ensure that the supply matches.