China tightens distributor cap after local outfits hoard automotive silicon then charge silly prices
- Reference: 1628060319
- News link: https://www.theregister.co.uk/2021/08/04/china_probes_automotive_silicon_distributors/
- Source link:
The regulatory body [1]promised to strengthen supervision and punish illegal acts such as hoarding, price hikes and collusive price increases. SAMR singled out distributors as the object of its ire.
In the early stages of the COVID-19 pandemic, prices for items such as hand sanitizer, face masks, toilet paper and other health-related items saw [2]startling inflation that required legal intervention.
[3]
As the pandemic wore on and work from home kit became a necessity, the world saw a new kind of shortages: semiconductors.
[4]
The automotive industry was hit particularly hard by the shortage, largely because its [5]procurement practices sent it to the back of the queue . The industry has since endured factory shutdowns and reduced levels of vehicle production – which, given cars have long supply chains, is not the sort of thing anyone needs during difficult economic times.
[6]'This is the worst I've seen it' says Arista boss as entire network hardware sector battles component shortages, doubled lead times for semiconductors
[7]Apple boasts of record quarter, but warns supply shortages will get worse before they get better
[8]Intel: 'Another one to two years before the industry is able to completely catch up with demand'
Chinese entrepreneurs are clearly alive to the opportunities the silicon shortage presents. Last month several Chinese would-be bootleggers were [9]caught smuggling the critical tech with tactics like taping US$123,000 worth of product to their calves and torso or hiding them in their vehicle as they attempted to cross borders.
Analyst firm Gartner has [10]predicted semiconductor shortages will remain moderate to severe for the rest of 2021 and continue until the second quarter of 2022. Taiwanese chipmaker TSMC has [11]said shortages will continue until 2023.
The Register imagines that those that can influence chip prices in China, and elsewhere, will continue to try their luck until demand deflates. Or until SAMR gets a grip on regulation, whichever comes first. ®
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[1] http://www.samr.gov.cn/xw/zj/202108/t20210803_333318.html
[2] https://www.theregister.com/2021/07/14/uks_largest_trade_union_takes/
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YQplYPr5uDxoUdGZJPbK9AAAAFI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YQplYPr5uDxoUdGZJPbK9AAAAFI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2021/06/01/automakers_pc_chip_shortage_explained/
[6] https://www.theregister.com/2021/08/03/networking_vendors_hit_by_supply_chain_component_shortages/
[7] https://www.theregister.com/2021/07/28/apple_q3_2021/
[8] https://www.theregister.com/2021/07/23/intel_q2_2021/
[9] https://www.theregister.com/2021/07/09/china_cpu_gpu/
[10] https://www.theregister.com/2021/05/12/gartner_shortage/
[11] https://www.theregister.com/2021/04/16/tsmc_chip_forecast/
[12] https://whitepapers.theregister.com/
Re: Smugglers
isnt it the other way round in this case ? However, the forbidden fruit syndrome is pervasive. Merkin booze consumption fell after Prohibition was repealed. What is curious is that PRC acts against "big business" exploitation of markets in a way that supposedly capitalist nations pretend to. The world is getting weirder
Re: Smugglers
The thing is that as soon as something is made illegal the supply collapses, and the demand mostly doesn't.
Via the immutable laws of supply and demand the prices then leap. If your earning the minimum wage and somebody offers you ten years worth of your wages in exchange for smuggling a small packet with little risk of getting caught then many people tend to be willing to give it a go, especially if they don't think it's harmful. (ie; many people won't smuggle hard drugs but will cheerfully smuggle computer chips, [1]prohibited books in workers paradises and the like.)
[1] https://en.wikipedia.org/wiki/Samizdat
Re: Smugglers
Look at the effects of the western Wars on Drugs - they have raised prices, demand, and supply, with the "bonus" of jailing people that were not voting for the governments - we may see the same thing happen in China.
Please
Can we have a State Administration of Market Supervision to investigate price gouging here too please?
Can we all just stop for a moment and admire that glorious headline pun? One of the best in a long while.
Oopsie daisy
Someone said "Never let a good crisis go to waste".
They know very well what's going on and a PR piece describing an attempt to curb the gouging does not look genuine.
It is very convenient for China to cripple businesses in the west. Once company in the west goes bankrupt, they'll have "oven-ready" replacements.
They masterfully outplayed us.
Smugglers
It's curious how, as soon as there's a law against doing something, there is always somebody willing to go to any extent in order to do just that.
Is this tendancy for crime hard-wired in our brains, or what ?