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How is Chipageddon affecting you?

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DC1MC:
You reap what you sow mofos, do another 300% increase  :-DD

https://slashdot.org/story/22/12/22/2238222/micron-to-cut-10-of-workforce-as-demand-for-computer-chips-slumps

peter-h:

--- Quote ---Anyway, the shortage seems to be easing indeed. A number of parts are starting to reappear in reasonable quantities.
Whether it's just temporary or not, I don't know.
And, whether it's a good sign or not - unfortunately, I strongly suspect it is just recession rearing its ugly head.
But fact is, I can actually get parts at the moment.
--- End quote ---

I came back to this long thread because I am seeing the same.

But we aren't there yet. Look at e.g. Mouser and FT232BL. 8k+ in stock.  Bearing in mind the recent history of this chip ("the factory is not accepting orders") this is totally and utterly amazing. Only ~ 6 months ago their UK disti said that if we want some "allocated" by FTDI we will need to pay £1 on top of the then 4k+ price of £2.20 i.e. £3.20. And I had to beg for this, emailing their Taiwanese HQ and everybody else. So they got £2k extra "extortion fee" out of me for a 2k production run. Now this is not an expensive product I am selling so I was well pissed off with this blatent extortion especially as the FT232BL became ex stock more or less when the last of the 2k chips were shipped to us :) I don't mind posting this because I designed out the FT232BL and went to another chip which is a) available (I bought 2k from Digikey, ex stock) and b) is much cheaper at about £1.50.

I still have 4k bare boards which can be used only with an FT232BL but that's OK because I am sure it will be down to £2.20 before too long ;) There is a man in Italy selling the FT232BL for just over £2.20 but
- he will sell only 5k
- he wants cash in advance
- no discussion entered into beyond a middle finger (I will save you my view on that but let's say it involves credit card disputes with Italian ski shuttle companies)
- no chance of testing one first for counterfeit reasons
- as I know very well, there is absolutely zero chance in hell of getting a penny back from anybody in Italy (except via a credit card, and even that is very very hard because they fight till death)!

On boxing day I did a PCB which carries both the FT232 and the new chip and JLC are now making some; just shipped them, they say :)

So what is happening? Well, what has always happened in the 45 years I have been in this business. You get a hoarding run on chips, prices go sky high, often 10x, then it collapses into a bloodbath. But in every case the distis tell you nothing until the total and complete collapse. They are all crooks, and want to book orders at inflated prices until the last moment.

And that is where we are now, with Mouser:

1:   £5.90
10:   £5.10
50:   £4.75
100:   £4.45
1,000: £3.85

The 3.85 should be ~2.50 so we are at the "keep the imminent collapse quiet for another few weeks/months" stage. Mouser's 8k stock is amazing but is not moving! I was there a week ago. And they say "43,117 Expected 12/01/2023" so that will be a total collapse of the "FT232 extortion game".

So early 2023 is gonna be interesting :)

As the old saying goes: be careful who you screw on your way up, because you will have to kiss their bum on your way back down. And we will see a lot of companies on their way down, whose parts were designed-out in the past year. Maxim, FTDI, Microchip, and about half the parts list of my new product.

The Micron story above is hilarious...

tom66:

--- Quote from: peter-h on December 26, 2022, 08:00:46 pm ---But we aren't there yet. Look at e.g. Mouser and FT232BL. 8k+ in stock.  Bearing in mind the recent history of this chip ("the factory is not accepting orders") this is totally and utterly amazing. Only ~ 6 months ago their UK disti said that if we want some "allocated" by FTDI we will need to pay £1 on top of the then 4k+ price of £2.20 i.e. £3.20. And I had to beg for this, emailing their Taiwanese HQ and everybody else. So they got £2k extra "extortion fee" out of me for a 2k production run. Now this is not an expensive product I am selling so I was well pissed off with this blatent extortion especially as the FT232BL became ex stock more or less when the last of the 2k chips were shipped to us :) I don't mind posting this because I designed out the FT232BL and went to another chip which is a) available (I bought 2k from Digikey, ex stock) and b) is much cheaper at about £1.50.
--- End quote ---

It's great things are getting back into stock, but there's nothing extortionate about charging market rate for a product.  Look at it this way:  if you take those 2k FTDI chips and put them into widgets you sell, but are lucky to have customer demand for 3k products, are you...

a) going to sell 2,000 products then tell the other 1,000 customers to wait X years for new product
b) offer a lottery where customers can 'win' the chance to buy a product, 2 in 3 chance of winning
c) increase your price until the demand falls to meet supply

In (a) or (b) you see your product (if sufficiently popular) on sale on eBay for the real market price.

That's the reality of limited supply, the price must rise, which causes demand to fall.  We will see semiconductor prices cooling down now supply is coming back, no doubt about that.  You can already see early days of this with the broker prices dropping.  Bosch IMUs were $120 a piece in mid 2020, now they are $15 from brokers.

In your case, you found a way to eliminate the need for that particular chip, so that's efficient too, as you were able to increase supply without increasing your costs too much.  You basically decided it was not worth paying a premium for it, and spent your time on an alternative solution.  It's frustrating to have to do that, but you clearly felt it was worth the cost/certainty.  We've been in the same situation, with many TI parts still difficult to get, they have been designed out.

peter-h:
I did have to pay the extortion fee on 2k of them.

I call this "opportunism". I bet you anything there is no extra actual demand for these chips. The "demand" is created (and always has been in the past) by quoting crazy lead times. Normally the "a-word" (allocation) strikes fear into buyers and they go crazy ordering everywhere, multiples of their actual needs.

The way this normally works is that prices naturally fall over time. Eventually they fall too far, and a "signal gets generated" to reverse the trend, and the "a-word" is where it starts. This has always worked.

After a bit of time - and this shortage has run for a lot longer than previous ones, driven by covid-induced hoarding of everything from chips to mountain bikes - it all collapses, but the supply industry suppresses the public admission until they can't. So we have nutty stuff like Mouser saying FTDI are not accepting orders and they have 8k in stock (which is not moving) and they will have another 40k next month. Does this add up? And do you think FTDI will drop the FT232BL when it is selling (probably) millions?

This is also interesting and will work in our favour



The chinese have been able to supply chips which the western firms didn't supply. For example while you could not get STM 32F4 you could get the ESP32 stuff. So Espressif made a packet (although of course STM made a huge packet too, selling a lot of chips at inflated prices, to large customers, while not shipping to the disti channel) but there is a political risk... if china gets too aligned with Russia, a lot will change fast. The chinese will retain the bare PCB etc business (because the western PCB industry basically collapsed 20 years ago, and it was junk-QA before then) but CPU choices are made long-term.

SiliconWizard:
Don't get your hopes up too high anyway, nothing that is bound to happen in the next few years is going to be pretty IMHO. Any glimmer of hope is likely going to be only temporary.
Cutting ties with China while they handle most of our production these days? Sure. Right. No problem. Nobody is going to suffer. :-DD

We can just take advantage of the temporary improvement and not put all our eggs in the same basket.

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