• Lead times continue to stretch for the US manufacturers, meanwhile the balance of the supply base (Taiwan, Japan and Korea) have maintained their previously quoted lead times.
• The majority of suppliers have quoted their factory utilization at > 95%.
• Suppliers continue to see increased orders from the Automotive, PC & Server markets.
• China-based cell phone manufacturers have forecasted a slow down but expect to pick up again in Q2’22.
• Unforeseen disruption caused by the COVID-19 outbreak continues to impact production cycles, transportation, logistics and causing factory closures in extreme cases.
• Order backlogs are at an average of 3-4 months. EU and NA orders remain strong, but suppliers have mentioned a slight weakening from the Chinese market.

• Demand from various industries including consumer electronics, automotive, industrial, defense and medical is expected to continue to drive the increased consumption of MLCCs.
• Demand for capacitors and associated technology remains at an all time high.
• Consumption is being impacted by net new demand for passive electronic components from multiple end markets, all to support changes in infrastructure and the growing stay at home environment.
• EU and US market demand seems to be stable or slightly up, there is a slight weakening in the Chinese market due to semiconductor shortages.
• Smart phone and module manufacturers are adopting the 008004 case size.
• Increased electronic content in automobiles has driven substantial growth in automotive grade MLCCs.
• The automotive market remains the most talked about business vertical –most suppliers view this market as critical to attaining substantial revenue growth over the forthcoming years.
• The increasing popularity of electric vehicles will drive the next wave of demand for automotive grade MLCC as each car requires 3 to 4 times more MLCC than normal gasoline vehicles.
• There are significantly more newly approved manufacturers supplying automotive grade components having gained approval from both the car and tier-1 manufacturers.
• The evolution of the Internet of Things (IOT) and 5G networking is and will generate more MLCC demand than ever before, particularly with more smart and connected devices being developed.
• Our key message for long term supply assurance continues to be the alignment of technology needs and supplier selection. Technology focus and roadmaps varies significantly by supplier.

• We expect to continue to see increases from US based manufacturers into Q2‘22.
• PGM Ceramic (palladium content) pricing still remains high, and suppliers are increasing pricing for high reliability/niche products.
• Defense, Military and Aerospace sectors are faced with increases due to an upward trend in raw materials pricing -these are typically high reliability parts.
• Pricing on Legacy items continues to increase with some suppliers increasing quotes again in the market for Q1’22.

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• All Tantalum suppliers are currently running at full capacity. Supply constraints are expected to continue well into 1H‘22 due to overwhelmingly strong market demand.
• Using Jabil leverage and our relationships, we managed to reduce component lead times as follows, (on average) for AVX 33 weeks, Vishay 26 weeks and Kemet 35 weeks.
• Tantalum Polymer are still in high demand with a Book to Bill ratio of 1.7:1 and 38 weeks lead time from Kemet. Panasonic is equally overloaded, and lead-times are quoted at 34 weeks.
• Kemet has a healthier position in terms of flexibility and capacity to support Jabil and our customers at this point in time.
• AVX has less flexibility to support short lead time orders, we have seen gradual improvements for small case sizes A, B and C but we are still facing major supply disruption for D & E cases.
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• Polymer Aluminum will be the key focus in terms of supply and cost – this technology will replace conventional and legacy Mn02 products.
• Demand for multilayer box type Aluminum Polymer has been showing strong demand and increasing year over year as it replaces tantalum polymer.
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• Tantalum and polymer pricing continues to be volatile due to instability in the supply chain as well as increased raw material,  logistics and operational costs primarily driven by the impact from the global pandemic.
• Price for legacy products, for example, Wet tantalum and military series, will continue to increase due to lack of economic scale as demand continues to fall. Mn02 and Polymer prices are increasing and expected to continue to rise through 2022.

• Aluminum capacitors suppliers are all operating at full capacity. Capacity is extremely overloaded with the current strong market demand meaning book to bill ratios are reported to be on average 1.7-1.8:1.
• Lead times continue to stretch, ranging between 36 and 54 weeks across the supply base. The capacity across the supply base is fully booked through 2022 and they will have significantly less flexibility to support short lead time orders.
• Hybrid and SP capacitors supply is severely constrained with allocation in place due to strong demand recovery from Automotive, 5G infrastructure, Cloud, Storage and Networking sectors.

• We continue to advocate a multi-source strategy. This may have a negative impact on the blended component cost but this is extremely important to secure supply and to minimize the risk to production.
• Jianghai is now supporting most of the high capacitance and high voltage capacitor markets and has the greatest  potential for growth in the high voltage snap in technology space.
• Aihua continues to have major growth and capacity expansion, the China based supplier is now ranked #4 globally with particular focus on standard parts.

• Aluminum capacitor prices are expected to continue increasing into Q2’22 due to inflated raw materials pricing (foil & cooper), logistics and operation costs. Price increases are expected to continue throughout 2022.
• Film and Super capacitor pricing are also trending up due to strong demand and operational cost impact.

• As we enter 2022, almost all facilities will continue to operate full  capacity due to extended backlogs and high demand.
• Lead times will not extend further but remain at a high level due to the increased lead-time for the supply of raw materials.
• INDUCTOR
  • Multilayer chip inductor lead times remain at a high level and bookings are still higher than the stated capacity. Some manufacturer’s book to bill ratios are as high as 1.25:1 and lead times are up to 36 weeks.
  • Molded inductor lead times will not extend further due to capacity expansion. Vishay’s IHLP inductor series lead times have reduced on the following families due to the new capacity coming online: IHLP2020 - 18 weeks, IHLP2525 – 14 to 18 weeks, IHLP4040 – 18 weeks, IHLP5050 – 14 weeks, IHLP8787 – 14 weeks.
• FILTER
  • Ferrite bead lead times are being quoted at 20 weeks plus. Some manufacturers have extended larger case size lead times to over 30 weeks and fulfilling orders via an allocation methodology. Minimal flexibility for pull-in of 0603 case sizes and larger.
  • Common mode choke lead times are up to 36 weeks. TDK remains highly constrained. TDK ACT45 and ACT1210 series are 36 weeks. TDK ACM series is quoted at 28 weeks. Minimal flexibility for pull-in.
• TRANSFORMER
  • Lead times remain at a high level due to the shortage of raw materials, especially ferrite core. The core manufacturers have been struggling to get enough “FeO” (Ferrous Oxide) and has therefore restricted output from the core manufacturers to their key customers - the transformer manufacturers.

• Yageo will acquire all outstanding shares of Chilisin’s common stock in a stock-swap transaction. The transaction is expected to close on December 30, 2021.
• Taiyo Yuden had announced EOL plan for their chip ferrite bead, BK/BKP line up, to be terminated by end 2022.
• We continue to see new start-ups in western/central China, primarily driven by continuous cost increases (labor, facility, etc.) in the southern China regions.
• Since 2018, we have seen new start-ups in Vietnam, primarily driven by the US/China trade conflict.

• Prices are generally flat to up due to tight capacity, increased raw materials and logistics costs, and reduced inventory in the market.
• SMD inductors and filter, including focused product lines, are experiencing the increased production costs with no price reductions in the near to mid-term.
• Price levels for customized inductors, transformers, bigger size SMD inductors and filters are expected to increase due to the high content of raw materials, which are under significant cost pressure. Also, logistics and transportation costs have increased significantly and will continue at these higher levels.
• The raw material cost up-trend started back in 2016 but paused during 2020. We have seen price levels surge since the end of 2020.

• The incredible level of demand acceleration has maximized production capacity and caused numerous raw materials (Package, Quartz Blank and IC) constraints as well as shortages in Crystals and Oscillators. For certain products, it has reached a point where global demand is significantly higher than the available global production capacity.
• Covid related shutdowns and restrictions have caused factories to operate with a reduced workforce resulting in decreased output. To compound this, we have seen labor shortages in suppliers’ factories in China and Malaysia as workers are not returning to work.
• Book to bill ratios are at a high levels – average 1.5 to >2:1 for certain products.
• Industry analysts have forecasted the current supply constraint situation to continue well into 2022 and possibly into 2023.
• KHz Crystals are on worldwide allocation, especially 3215 size which is commonly used in many product applications. Many suppliers have their capacity booked well into 2022 and 1H of 2023, they are struggling to meet existing customers’ demand and are rejecting any new business / increased demand. Moreover, suppliers continue to shrink their production capacity for 3215 size and focus on the expansion of the 1610 size output.
• Extended lead times for MHz Crystals remains, ranging from 20 to 50 weeks depending on package size. The supply situation is more serious for 2520 and 3225 package sizes.
• Lead times for Oscillators are at 50 weeks or more and continue to stretch primarily due to the shortage of ICs. Some IC suppliers had announced EOL on their mature products which has impacted the production of certain Oscillators.
• The supply situation for standard TCXO has improved, lead-times now ranging from 16 to 20 weeks. IC supplier - AKM has engaged Renesas as their manufacturing partner and the production output has gradually increased since Q3’21.

• With an increasing number of products going obsolete due to maturity or unavailability of raw materials, OEMs need to design their products to align with suppliers’ latest technology roadmaps.
• Downsizing is essential. Propose these packages: 1610 size for KHz Crystals, 1612 or 2016 size for MHz Crystals and 2550 or 3225 size for SPXO.
• Move to Taiwanese/Chinese suppliers for HC49 Metal-can Crystals.

• Shortage of raw material (Package, Quartz Blank and IC) due to Covid related factory shutdowns, labor shortages and increased global demand continue to inflate raw material costs.
• The increased demand has also put a strain on the availability of labor, and thus labor costs continue to rise.
• Increased demand has also strained the transportation industry and driven shipping costs to new inflated levels.
• This has resulted in a few rounds of price increases in many Crystals and Oscillators products since 2020 and price increases are expected to continue well into 2022.
• TCXO price has stabilized slightly after the substantial price increases which happened over the past 12 months.

• We are seeing increased supply constraints resulting from the overwhelming increase in market demand across most market sectors.
• Lead times for Fuses has stretched to 16-26 weeks, depending on product. SMT Fuses has stretched to 35 weeks.
• Lead times for Leaded Varistors has stretched to 20-30 weeks.  
• Lead times for Multilayer Varistors (MLV) has stretched to 20-30 weeks. 
• Lead times for Gas Discharge Tube (GDT) has stretched to 24 weeks.
• Littelfuse, #1 Fuse Supplier, is investing in additional capacity to meet the high demand for their products.

• Bourns acquired Keko-Varicon, manufacturer of overvoltage protection components that include Varistors and EMI suppression products. The Bourns sales team will manage the quotes for Keko-Varion products.
• Littelfuse acquired Hartland Controls, manufacturer of Circuit Breaker for the HVAC market.

• Price increases across all products - Fuses, Varistors, GDT & Fuse Holders. Primarily due to the increased price of raw materials – Gold, Silver, Copper, Palladium, Zinc, Tin as well as increases in labor and freight costs.

Consistent message - Capacity constraints, supply allocation and extended lead times. 

• Suppliers continue to see a huge increase in order intake, with book to bill ratios being quoted at 1.5:1 or higher. 
• Supply constraints expected to continue throughout 2022.
• High demand driven from major markets like automotive, consumers, telecommunication and industrial. The recent surge in demand has further exacerbated the already highly constrained supply situation.
• To illustrate the situation with some major resistor manufacturers, Vishay's is now running at 100% capacity with lead times extending to over a year. KOA have announced monthly supply allocation to all their customers, Panasonic and Rohm are at full capacity and only supporting existing forecasted business.

Accelerated shift in technology in the competitive landscape.

• Vishay continues to be the technology leader in resistors but is increasingly facing competition from the lower technology players.
• Japanese suppliers have de-emphasized mature or standard products like standard thick film resistors and array due to low profitability thus impacting the suppliers left to support the overall demand.
• Taiwanese resistor manufacturers have attained more automotive AML approvals recently, due to the severe undersupply situation from the traditional automotive resistor manufacturers.
• Demand for smaller size resistors continues to accelerate despite the technical problems associated with the miniaturization of electronic devices. Consumer demand for small, easily portable electronic products like compact smartphones, lightweight laptop computers, and tablets drive the miniaturization of electronic components including the various resistors families.

Price increases across global markets

• Price adjustments have occurred since Q2’21, particularly in the highly price-sensitive Chinese market. We are now seeing this increased pricing trend spreading to all global markets.
• Primary factors for the cost increases are capacity constraints and rising costs of raw materials such as copper, Palladiums, silver, nickel and ruthenium as well as logistic costs.
• Chinese substrate makers have already increased pricing by 10%-15%.
• Increased pricing across most case sizes, with the mature / legacy products being more pronounced.