On Tuesday, TSMC CEO and President Wei Zhejia warned that a widespread shortage of chips costing between 50 cents and $10 is hampering the development of the $600 billion semiconductor industry, according to media reports. These low-end chips continue to be in short supplied, hampering some key production loops in the supply chain.

         ​​Wei Zhejia said that ASML is working hard to obtain chips for its EUV lithography machines that cost around $10. TSMC has dozens of these machines, which are critical for packing higher-power components on smaller silicon dies. Elsewhere, a $50,000 car cannot be produced because of a shortage of a 50-cent radio chip.
        Wei Zhejia pointed out that TSMC's production capacity has been unable to use the original factory to meet customer demand for low-end chips. The company is building new factories, including a new 28-nanometer process factory in China that will start production in the fourth quarter, and hinted that in the next few In June, the cost of mature process chips is also likely to increase.
        Despite a general drop in demand, logistics chaos and chronic shortages of parts continue to plague some industries. Applied Materials (AMAT.US) said this month that its backlog of orders was growing as it struggled to get enough semiconductor supplies to make equipment. Nvidia (NVDA.US) said it had trouble getting support chips, including power converters and transceivers, to make as many data center products.

        In this regard, Wei Zhejia said: The era of efficient and globalized supply has passed. As more and more countries scramble to build fabs, production costs are also rising, and factors such as inflation are also pushing up costs.