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THE RESILIENCE OF THE SEMICONDUCTOR SUPPLY CHAIN

The semiconductor industry is changing. After three years of disruption,
shortages and strong demand, chip makers and their customers are striving to
increase the resilience of their manufacturing networks and supply chains. They
are applying lessons learned during the pandemic to build systems that can
mitigate shocks and support sustained long-term growth.

Semiconductor players are making unprecedented investments in new manufacturing
facilities, aiming to increase overall capacity and reduce the geographic
concentration of critical production capabilities. Their customers, meanwhile,
are rethinking their product, inventory, and supplier collaboration strategies.


This discussion paper examines the logistics implications of these shifts, from
the challenge of building and supporting multiple new fabrication plants to the
need for smarter, more flexible supply chains for semiconductor components.


DHL DISCUSSION PAPER

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Sources: semiconductors.org mckinsey.com asml.com semi.org

 

--------------------------------------------------------------------------------


CHALLENGES AND OPPORTUNITIES FROM SEMICON SUPPLY CHAIN RESILIENCE

The Challenge

The Producer Response

The Customer Response

The Role of Logistics

The Future Supply Chain

 * 

THE CHALLENGE

Despite operating at close to maximum capacity, the global semiconductor
industry unable to satisfy increased demand for chips. Supply shortages have led
to $500 billion in lost sales of semiconductor-dependent products over the past
two years.

THE PRODUCER RESPONSE

The industry is now investing 99 billion USD in fab equipment in 2022, almost
double the pre-pandemic rate. Government incentives are encouraging
semiconductor players to locate new plants right across the world, and the
building boom is already stretching the capacity of contractors and suppliers to
the sector. Source: Semi.org

THE CUSTOMER RESPONSE

To ensure availability of critical materials, the industry’s customers are
selectively increasing their inventories, investing in new visibility and
forecasting tools, and entering new advance-purchasing agreements.

THE ROLE OF LOGISTICS

The logistics industry can provide support across the whole semiconductor value
chain, for example by providing advanced project logistics capabilities and
adaptable warehousing solutions to support fab construction, or by helping
semiconductor users to improve visibility and predictability and smart, flexible
inventory and fulfillment strategies.

THE FUTURE SUPPLY CHAIN

Resilience in the semiconductor sector will require closer collaboration within
and between companies. With the help of advanced digital tools, they can achieve
greater transparency and make faster, more effective decisions. That will help
them overcome today’s issues, and equip them to build supply chains that are
robust, responsive, and sustainable.

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