Avnet Insights Survey Indicates Chip Shortages Will Continue; Explores Impact on Product Design
March 01 2022 - 7:00AM
Business Wire
The global component shortage is not only extending order
fulfillment and lead times, but is also having a ripple effect on
product design. According to the inaugural Avnet (Nasdaq: AVT) Insights, a new survey
on the trends and market forces in the electronics industry, design
engineers are exploring new ways to get their products to
market.
Key takeaways:
- More than three-fourths of respondents said due to shortages,
access to electronic components has been a very significant
challenge.
- Among those who have experienced a significant impact due to
the electronic component shortage, a preponderance (93%) said they
have experienced a major impact on longer lead times.
- Designers are seeking additional routes to source parts,
including through spot market brokers – but they have significant
concerns about counterfeit control, which could compound design and
quality issues over the long-term.
- The shortages are changing the way engineers design, as 64% now
say their companies are designing more based on the availability of
the components rather than preference.
- And there are likely more challenges to come. Currently,
three-fourths of those experiencing production delays say they have
lasted up to six months – while a strong majority of overall
respondents expect lead times to worsen and prices to rise in the
next year and a half, implying those delays are only set to
grow.
The Avnet Insights customer survey was conducted among n=530
global engineers, 31% of which were based in the Americas; 56% in
EMEA; 10% in Asia and 2% in Japan.
Components access remains a challenge, and most expect it to
get worse.
Seventy-eight percent of respondents face significant challenges
accessing electronic components, Avnet found. Those in
telecommunications in particular are feeling the strain, as 83% of
respondents in that industry reported significant challenges.
Among those who have experienced a significant impact due to the
shortages, 93% said they feel this most strongly related to lead
times. Behind those, respondents also say they experienced major
impacts in delayed production schedules (74%) and higher prices
(72%). And while the specific impact varies by industry – those in
the telecommunications, aerospace and electronics industry are most
likely to see an impact on pricing, for example – there are
consistencies, especially as it relates to expectations for what is
to come.
Among respondents who have experienced delayed production
schedules, 75% say that delay has been under six months. But a
strong majority of all respondents expressed concerns about lead
times getting even longer and prices getting even higher (96% each)
in the next year and a half.
Distribution adds value with counterfeit control and design
insights.
The survey unveiled significant opportunity for distributors to
address counterfeit concerns. 76% of respondents said they expect
counterfeit components to increase, but another 8 in 10 (83%)
emphasized that they work with distributors to lessen the chance of
encountering those counterfeit parts.
When design-in components are not available, most rely on
redesigned boards (55%), pin-to-pin replacements with better specs
(53%) or drop-in replacements (49%). These preferences vary
regionally; designers in the Americas are most likely to use
drop-in replacements, with nearly three-in-four (73%) saying they
have done so.
But Avnet found that availability is impacting more than just
where engineers are seeking the parts for their designs – it is
also impacting how they create said designs. In the wake of the
shortages, two-thirds (64%) of respondents said their company is
designing more based on availability of components over
preference.
“The shift from designing based on first choice to designing
based on first available for a prolonged period is a ripple effect
from the overall shortages that could significantly impact the
electronics industry,” said Peggy Carrieres, Vice President of
Sales Enablement and Supplier Development. “However, it also
represents an opportunity for engineers to lean on their partners
with added visibility into the supply chain to ensure they are
creating flexibility in their designs based on market conditions to
avoid compromising quality.”
The Avnet Insights customer survey was conducted among n=530
global engineers. Regionally, 31% of respondents were based in the
Americas; 56% in EMEA; 10% in Asia and 2% in Japan. The survey was
fielded online from Nov. 4 to Dec. 3, 2021 using Avnet’s global
customer database.
About Avnet
As a leading global technology distributor and solutions
provider, Avnet has served customers’ evolving needs for an entire
century. We support customers at each stage of a product’s
lifecycle, from idea to design and from prototype to production.
Our unique position at the center of the technology value chain
enables us to accelerate the design and supply stages of product
development so customers can realize revenue faster. Decade after
decade, Avnet helps its customers and suppliers around the world
realize the transformative possibilities of technology. Learn more
about Avnet at www.avnet.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20220301005178/en/
Jeanne Forbis Avnet Jeanne.forbis@avnet.com 480-649-7499
Alex Jafarzadeh Brodeur Partners, for Avnet
ajafarzadeh@brodeur.com 617-587-2846
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