Steel Markets
Semiconductor Shortage Spreads into Appliance Sector
Written by Michael Cowden
February 26, 2021
The semiconductor shortage that has forced North American automakers to temporarily halt production at some assembly plants has spilled into the home appliance industry as well.
The situation is severe enough that the Association of Home Appliance Manufacturers (AHAM), a lobbying group, has warned about potential re-allocations of semiconductors from that sector to others.
There is an “urgent problem” with the global supply of semiconductors, which are “critical” in home appliances, AHAM President and CEO Joseph McGuire wrote in the letter, dated Feb. 24, and addressed to President Joe Biden.
“We need an immediate increase in global production of semiconductors to ensure home appliances continue to be available to meet the increased usage demands exacerbated by the pandemic,” McGuire wrote.
“As your administration weighs options for increasing short-term supplies of semiconductors, we strongly urge that any solution avoid reallocating semiconductors from the home appliance industry,” he added. McGuire’s letter did not specify where chips destined for home appliances might be redirected.
The automotive industry has already been hit hard by the chip shortage, something that has forced General Motors to idle several North American plants through mid-March.
The appliance sector, like the automotive sector, is a steel-intensive industry that has experienced strong demand thanks to consumers spending more on durable goods and less on travel and services following the outbreak of the COVID-19 pandemic.
Case in point: Orders for durable goods surged 3.4% in January, more than triple economists’ forecasts of a 1.0% gain for the month.
A spokesman for Whirlpool, based in Benton Harbor, Mich., and one of the largest home appliance makers in the world, declined to comment on whether the company’s operations had been impacted by the chip shortage. He referred Steel Market Update to AHAM.
By Michael Cowden, Michael@SteelMarketUpdate.com
Michael Cowden
Read more from Michael CowdenLatest in Steel Markets
AISI: Raw steel production bounces back
Domestic mill production rebounded last week, according to the latest production figures released by the American Iron and Steel Institute (AISI). Production had been historically strong over the summer months before softening in early October.
US sets Section 232 tariffs on trucks and buses
Medium- and heavy-duty trucks (MHDV) and buses imported to the US will start being charged Section 232 tariffs beginning Nov. 1.
Hot-rolled sources say demand continues to dwindle, prices feel arbitrary
Genuine demand, they stated, will return when the market feels stable again.
FabArc Steel Supply completes projects in Mississippi, Georgia
FabArc Steel Supply announced this week the completion of two large-scale projects in Georgia and Mississippi.
Thin demand keeps plate prices hovering at lowest levels since February
Participants in the domestic plate market say spot prices appear to have hit the floor, and they continue to linger there. They say demand for steel remains thin, with plate products no exception.