By Michael Carroll

Amon hungry for more chip capacity

Qualcomm President and CEO Cristiano Amon welcomed initiatives by US and European authorities to tackle supply chain problems affecting the chip industry, issues he believes would have come about regardless of the Covid-19 pandemic.

During a keynote session, Amon explained the industry was heading for something of a fall anyway, due to a spike in demand for connectivity from a wider range of industries, including automotive, consumer electronics, smartphones “and many other things that you wouldn’t realise have semiconductors in”.

Qualcomm’s chief argued this demand is “a testimony about how important and essential semiconductors have become for the future of economies in every country and across every industry”, with the pressure Covid-19 brought to bear on the supply chain simply accelerating a need to change how the chip industry works.

The crisis brought a new sense of awareness into focus of the need to build a resilient, geographically-diversified supply chain, he noted.

Amon pressed it is more important to realise this “level of consumption of semiconductors” comes before the industry truly feels the heat of demand fuelled by digital transformation, creating a “need to invest in much larger capacity for manufacturers of semiconductors”.

He highlighted the industry and governments are already responding to this need with initiatives to boost chip R&D and production, citing the European Chips Act, an €11 billion programme unveiled by the European Commission last month and the Chips for America initiative from the US government as examples.

“We’re being very encouraged as an industry to know the US and Europe are working together, because I think together it’s a greater chance of succeeding in meeting the goal of having at least 50 per cent of semiconductor manufacturing between those two geographies.”

For now, though, Qualcomm is still experiencing “more demand than supply”, Amon noted, predicting the situation will begin to improve in the second half of the year.