The semiconductor industry is facing supply and demand imbalances due to a surge in demand and disruptions in the manufacturing supply chain. Global demand for semiconductors continues to rise, but events such as the China-US trade war, the COVID-19 pandemic, and the Russia-Ukraine dispute have disrupted the supply. Many countries are now prioritizing securing chip manufacturing and promoting domestic production. Thailand’s semiconductor industry holds potential for advancement, but companies will need to embrace change and implement recommended strategies to adapt to evolving demands.
Supply and Demand Imbalances in the Semiconductor Industry
The semiconductor industry is facing significant challenges due to supply and demand imbalances caused by a surge in demand and disruptions in the manufacturing supply chain. This imbalance has been further exacerbated by events such as the China-US trade war, the COVID-19 pandemic, and the Russia-Ukraine dispute, resulting in surging raw material prices.
Global Dynamics and Shifts in Semiconductor Production
Despite the disruptions, global demand for semiconductors is expected to continue surging as countries transition to digital economies. Many countries are prioritizing securing chip manufacturing and promoting domestic production, with examples including the US and the EU enacting the CHIPS Act. China, while facing challenges in meeting local demand, is taking retaliatory measures against technological barriers imposed by the US.
Thailand’s Semiconductor Industry and Potential for Advancement
Thailand’s semiconductor industry holds the potential for further advancement, especially in front-end and higher complexity back-end processes. As the global production supply chain takes shape, several facilities are expected to relocate to Thailand, leading to increased investments in the sector. However, Thai companies must embrace change and implement strategies such as forming alliances and focusing on research and development to align with evolving industry demands.