A global chip shortage continues to hamper global businesses, from automakers to mobile phone makers, as well as other consumer, commercial and industrial producers. Unfavorable climatic conditions are now causing the supply chain, which has weathered the effects of the pandemic, military action and economic turmoil, to struggle.
Elias said the global chip shortage is complex and involves multiple sides Eliadis, senior director of strategy and transactions, business advisory services provider Ernst & Young. “Most industry experts agree that climate change will have an impact on chip production because it requires a highly controlled manufacturing environment, a reliable supply of ultrapure water (UPW), and stable environmental conditions such as temperature and humidity.”
Climate conditions can affect the production and distribution of chips in a number of ways. “Water quality issues or shortages can impact manufacturing yields and disrupt plant operations,” Eliadis said. Cold weather can disrupt power supplies or delay the shipment of raw materials and finished products. “Floods could lead to fab shutdowns [with] a bigger impact on yield,” he added.
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