Pegatron, a Taiwanese electronics supplier, is sounding the alarm regarding the tariffs imposed by the Trump Administration and the risk that it potentially could lead to shortages of consumer electronics in the U.S.
In a report from Reuters, Pegatron’s chairman T. H. Tung said the on-again, off-again tariffs have created uncertainty for retailers and is causing disruptions on shipments.
Pegatron’s concerns echo a recent report from TrendForce that stated end-device markets like AI data centers, AI servers, smartphones and notebooks are likely to shift downward.
"Within two months, shelves in the United States...might resemble those in third-world countries, where people visit department stores and markets only to find empty shelves, all because everyone is waiting and seeing," Tung told Reuters.
While some tariffs that were originally put in place have waned, there remains a 10% levy on nearly all goods imported into the U.S.
The last shortage
The last shortage came during the height of COVID-19 when lockdowns caused the supply chain to reduce the number of semiconductors to certain sectors — like automotive and industrial — due to a perceived lack of demand resulting from the pandemic. Instead, consumer electronics and communication chips were the bulk of the capacity in manufacturing as stay-at-home orders meant more purchases for smart home devices, televisions and streaming devices.
When these sectors returned to normal, chipmakers had shifted the mix so that there was not enough semiconductors to meet demand.
The shortage lasted for more than 18 months.
While it is unclear if semiconductors will be impacted in the same way as end-devices, as some chip tariffs have been quietly rolled back, the Trump Administration has stated it will likely impose tariffs on semiconductors soon. If tariffs are put on chips, it is likely to exacerbate the shortage.
