Commerce Dept. Reports That Some Manufacturers Have Less Than Five Days of Semichip Inventory
WASHINGTON—A new U.S. Department of Commerce report says many manufacturers that rely on semiconductors have only a few days worth of inventory at any time. The report is based on more than 150 responses to the Department's request for information from businesses that produce and use semiconductors. It found that the median supply of chips held by manufacturers has dropped from 40 days' worth in 2019 to less than five days' worth last year.
The limited supply means that disruptions to production overseas—such as those from weather or new Covid-19 outbreaks—could again lead to factory shutdowns and furloughed workers in the United States, according to the report. It notes that inventories are even smaller in what it terms "key industries."