Analysts Say Component Shortages for Console Makers Is Made Worse by Companies Hoarding Supplies

Toilet paper and hand sanitizers aren’t the only things folks have been hoarding during the pandemic. According to a report by The South China Morning Post and Bloomberg, major companies like Apple and Huawei are hoarding components, worsening existing supply shortages for small-volume buyers in the automobile and games industries, among others.

Will Bright, co-founder and chief product officer of peripheral manufacturer Drop, said that there’s “a chip stockpiling arms race.” “The virus pandemic, social distancing in factories, and soaring competition from tablets, laptops, and electric cars are causing some of the toughest conditions for smartphone component supply in many years,” added Neil Mawston of Strategy Analystics. Taiwan Semiconductor Manufacturing Co., which is the world’s chip supplier of choice, has reportedly been discussing the issue with Qualcomm, Corning Inc., and officials from President Joe Biden’s administration.

According to the report, Sony, Microsoft, and Nintendo have been struggling for about a year. The companies are expecting things to get worse before getting any kind of relief, which insiders say could impact the next holiday season as well.

None of this comes as a surprise. Sony has repeatedly brought up component shortages when discussing the PlayStation 5’s supply woes. Chief Financial Officer Hiroki Totoki recently said that it’s “difficult for us to increase production of the PS5 amid the shortage of semiconductors and other components.” He added that Sony will “continue to do everything in our power to ship as many units as possible to customers who are waiting for a PS5.”

[Source: SCMP via ResetEra]