Downturn in sight: Chip delivery times are falling more than they have been for years

It is an indicator of the downturn: the delivery times for microchips of all kinds fell in September at the lowest rate in years. But the level is still extremely high, which is why this statement can also be quickly put into perspective in another context.

The analysts at Susquehanna Financial Group determined 26.3 weeks in September instead of 27 weeks in August as the average delivery time for chips after they were ordered. A reduction of four days within a month is a clear downturn, but the level of delivery times is still extremely high, as the market researchers themselves show in a chart. It was less than 15 weeks before 2021.

Drivers for the long delivery times since last year have primarily been small chips from an area that is far below the high-end market, but which is still found in countless devices. But it is precisely these analog chips, small sensors or power management controllers (PMIC), which were responsible for the extremely scarce and expensive DDR5 modules at the start, among other things, are now the first whose delivery times are falling the most. The inventories that are now far too high at many companies mean that orders are falling significantly.

Downturn in smaller wafers first

Precisely sees the downturn in the area of the smallest and cheap chips also wafer manufacturer GlobalWafers. In the current fourth quarter, as many 300 mm and 200 mm wafer blanks as possible will continue to be produced, but a downturn in 150 mm wafers is visible, writes the Commercial Times.

For the year 2023, a huge gap between supply and demand for large wafer blanks was originally expected, but this now seems to be closing more and more. In the past few months, it has always been said that the manufacturers would actually be fully booked until 2024 or even 2026, depending on the product. Gaps are likely to open up here, although more than 80 percent of the contracts were long-term contracts, so-called LTAs. However, all wafer manufacturers continue to expand.