Manufacturers and suppliers of electronic components continue to play catch up following a solid 2021. In 2021, the component manufacturing industry showed a growth in sales of 20% while they are predicting a further 11% increase this year.

“On the back of these solid sales figures, the book-to-bill ratios have also been very positive”, said Hannes Taute MD of TRX. “For interconnect, passive and electromechanical components the book to the bill has been 1.4. For semiconductor components, the book-to-bill ratio has been around 1.8. This is an indicator that demand will continue to grow in the foreseeable future and possibly result in even longer lead times. Some components are showing that the lead time is stabilising, for the moment this is a positive indication”

Logistics is also partly to blame for shipping delays with Covid still affecting business in places like China and Hong Kong.

With increasing raw material prices there will be a definite push by manufacturers to increase prices on components. Consumers of electronic components are stuck between trying to produce products and making a profit. Fixed price agreements in today's supply environment could spell massive financial losses and even closure for some companies.

Companies that develop new products are really finding it difficult to produce. Suppliers allocate products according to supply history. For a new development there is no history so ordering any volume of electronic components is going to be difficult.

Motor vehicles use more and more electronics today. Anything from engine management to electric seats to LED headlights. This all adds to the demand for components. Electric vehicles are further adding to this global demand for components with countries incentivizing their citizens to move away from conventional fuel-driven vehicles.