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Supply chain lead time seen loosening up


Thursday, January 3, 2019

The record high level of component lead times in the second half of 2018 is showing some signs of coming back down with a drop of 5% since Q3.

In Q3, a study by Future Electronics showed, among other unprecedented levels of shortage, LV MOSFETs at an astonishing 39-52 weeks lead-time from Infineon and Fairchild, at 36-52 weeks from Nexperia, at 38-42 weeks from ST and at 26-40 weeks from Diodes.

Bluetooth modules were on 22-26 weeks from Murata, 18-20 weeks from Microchip, 16-18 weeks from Panasonic and 12-16 weeks from ST.

Even SRAM was on 18-20 weeks from Renesas and PC DRAM on 4-6 weeks from Kingston and 4-8 weeks from Alliance.

“There’s massive and far-reaching under-investment in the industry” says Future Horizons CEO Malcolm Penn, (pictured), “no one makes speculative capacity investments any more; everyone waits until demand is clear; the lead-time for new capacity is (and always was) one year; QED a recipe for delinquency and disaster.”

There’s also talk that the Trump tariffs and threat of giga tariffs are pushing people to over-order to avoid price hikes.

Reputed low-ish distributor inventory may also contribute to moves to replenish stocks and keeping lead-times high.

So, despite weakening end demand, there are several reasons why a decline in lead-times may not be significant or soon.

By: DocMemory
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