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IPFS News Link • Manufacturing-U.S.A

Chip Shortage Enters "Danger Zone" As Lead Times Reach New Record

• by Tyler Durden

Companies that use semiconductors in their end products use lead times to gauge the balance between supply and demand. Rising levels suggest customers are racing to secure chips. If leads exponentially jump, as what has been happening since December, some customers will purposely order more chips to avoid future supply shortfalls. Inventory accumulation can also exacerbate chip shortages. 

Susquehanna Financial Group reports chip lead times increased to 17 weeks in April, a level that surpasses the all-time high in 2018 and is described as a "danger zone." The firm began tracking lead times in 2017.