Lead Times Grow: Connector Backlog Hits 12 Weeks
In the two years since the pandemic began, the connector industry has been hit by production and supply chain challenges, as well as expanded orders for interconnects as demand rose for electronic products in every market. The result: connector backlogs.
Supply chain challenges have been a symptom of the pandemic since China extended its Chinese New Year plant closures in January 2020. That holiday turned into an extended quarantine, which ultimately spread across the global electronics industry and supply chain as other countries were infected. As the virus spread, second tier manufacturing regions experienced similar challenges, pushing some manufacturing back to China as Vietnam, Indonesia, Malaysia, and other regions faced outbreaks. In September 2021, China locked down again to attempt to reach its “Zero COVID” goal in anticipation of the Beijing Winter Olympics.
Raw material shortages, component and chip shortages, cargo ship shortages, dock and transportation employee shortages, and other challenges have meant the electronics industry has been trying to catch up with demand since this all began. At the same time, demand is greater than ever: Orders for interconnects rose as consumer and business demand increased for electronic products in every market.
Since 2019, the connector industry’s backlog has doubled from six weeks to 12 weeks. In 2019, the ending backlog was $8,021 million (six weeks). At the end of September 2021, the backlog was $19,262 million. This is an amazing increase of $11,244 million, up 140%!
Lead times reached 12.6 weeks at the end of September 2021. The end may be in sight, however. Industry personnel predict that lead times will decline in 2022 to 7.6 weeks. This forecast of a decline is probably related to slowing gross domestic product (GDP) in China, the U.S., and Europe.
Bishop & Associates will continue to monitor the connector backlog closely and provide further reports in The Bishop Report. This article originally appeared in The Bishop Report.