Packaging, supply and logistics 81% CNBC


Taiwan and South Korea control the majority of the chip manufacturing market worldwide.


Manufacturers are encouraged to design products with the chip shortage in mind until the market stabilises.


Lewis argues that leaving investment to eager capitalists makes more sense in other ways too. “Politicians tend to be too late about understanding what’s important, and tend to be subjected to lobbying by people who don’t put their own money at risk,” he says in a critique of the statist approach. When it comes to medical devices in particular, meanwhile, it’s also important to appreciate what kinds of semiconductors machines actually need. So-called ‘standard’ semiconductors – off-the-shelf and mass-produced – may be less customisable than their more specialised cousins. But they’re also quicker to make and get to market. And as it happens, many common medical devices use precisely these chips, from ultrasounds and CT scanners to MRI machines. To put it another way, there’s some evidence that if manufacturers design products with the future in mind, they can act to avoid the worst shortages until the market finally stabilises.


Getting their act together? What, then, does the future hold for the semiconductor industry? Though Lewis is reluctant to make watertight predictions, he suggests that rising geopolitical tensions could yet push politicians


Medical Device Developments / www.nsmedicaldevices.com


to promote schemes like the CHIPS Act – regardless of their efficacy in the real world. “In my view, it’s politicians needing to show that they’re doing something,” he says. “You’re always going to have people who take every issue and want to frame it in terms of criticising political opponents – so a lot of government action is to forestall or preclude that type of criticism.” That, at any rate, seems to be happening rhetorically. As President Biden recently warned colleagues in the House unwilling to pass the CHIPS Act: “All [semiconductor manufacturers are] waiting for is for you to pass this bill.” What all this means for medical devices in particular remains unclear. Lewis, for his part, doesn’t expect any funding to be ring fenced for hospital machines or any other area, arguing that any approach will inevitably be “holistic.” What that means for the availability of glucometer chips and the like remains unclear – but there are signs the current crisis may be coming to an end. According to Pat Gelsinger, CEO at Intel, the current chip shortage will continue through 2023. By then, of course, new hiccups might have disrupted supply chains once more – whether due to government action, or thanks to some other emergency. Given the way our century is going, that, at least, should come as no surprise. ●


$834bn


Private firms like Nvidia and IBM plan this amount in new chip capacity over the next decade, dwarfing the $50bn offered by Congress.


Lexology 109


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