MYRTLE BEACH, S.C. (WBTW) — The nationwide microchip shortage has impacted almost every industry from cars to appliances and cellphones.
The computer and gaming industries have experienced shortages and price increases since the pandemic began.
“Chips are being used in everything these days for communication, appliances in your home so that has created additional demand,” said Chuck Walker, with T-Rex Computers in the Myrtle Beach area.
Walker said gamers have been impacted pretty heavily by the shortages.
“On the gaming side I had a lot of customers that were wanting systems,” he said. “They were trying to either upgrade their existing gaming computer with a new video card or a new chip and finding a problem being able to get it.”
He said companies created problems by “hoarding” products.
“Companies were ordering more than they really needed,” he said. “Some of it was just in back up not knowing what their volume was going to need and the other was just to keep the price under control because obviously with supply and demand when there’s limited supply the price goes crazy.”
He said this is what he is seeing now with the price of chips. While a chip used to cost between $200 and $300, high-end chips are now $600.
“Then consequently computers — which use about a third of all the chips that are produced — has increased the cost on computers,” he said.
The cryptocurrency boom during the pandemic also increased the need for high-performance video cards.
“It created a shortage in the industry because anybody and anybody could set up their computer — as long as it was a high-end computer and had enough video cards to mine their own cryptocurrency,” he said.
He said this shortage has gotten better recently. By the end of the year, he expects some of the shortages to be over and at more normal levels.
He said the industry is addressing the issue.
“Right now, the industry has brought on some of the older equipment in order to increase capacity to create a temporary supply, address the issue,” he said. “But of course, there’s new manufacturing facilities that are going to be starting up in South Korea as well as the U.S. that will make things in the future much better for the ongoing demand increase.”
President Joe Biden is expected to sign the CHIPS and Science Act next week to try and tackle these issues. The CHIPS and Science Act will subsidize U.S.-made chips used in cars, appliances and computers.