Why the World Is Short of Computer Chips | Explain This

Carmakers have been slashing production. PlayStations are getting harder to find in stores. Even aluminum producers warn of a potential downturn ahead. All have one thing in common: an abrupt and cascading global shortage of semiconductors.

Also known as integrated circuits or more commonly just chips, they may be the tiniest yet most exacting product ever manufactured on a global scale. That combination of cost and difficulty has fostered a worldwide dependence on two Asian powerhouses -- Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. -- a reliance exacerbated by the pandemic and rising U.S.-China tensions even before the current deficit. Hundreds of billions will be spent by governments and corporations in coming years on a “chip race” with geopolitical as well as economic implications.

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