Supply-chain problems will last through 2023, Intel chief says

BY THOMAS GRYTA | UPDATED DEC 07, 2021 06:43 PM EST

The supply-chain problems rippling across the U.S. economy are improving for some companies, but long-term fixes might take much longer, the heads of Intel Corp., Wayfair Inc. and Accenture PLC said at The Wall Street Journal CEO Council Summit on Tuesday.

“The bottom was this past summer, but it’s recovering slowly,” said Niraj Shah, chief executive officer and co-founder of online retailer Wayfair.

Chip giant Intel, which has been at the center of the global semiconductor shortage, expects supply-chain issues to last through 2023, partly because it takes three years to build a new factory, CEO Patrick Gelsinger said.

“We think the period we are in now is the worst of it,” he said. In July, Mr. Gelsinger said he saw the global semiconductor shortage potentially stretching into 2023.

Mr. Gelsinger said Intel had allowed its supply chains to consolidate in Asia, leaving the company without the geographic balance to cope with disruptions. He said the company has plans for a large U.S. factory he called a “megasite” to move production closer to where chips are needed.

Julie Sweet, CEO of consulting company Accenture, said that “supply chains don’t get transferred overnight” and that global shifts would take time to unfold. “China will continue to be an important supplier to the globe,” she added.

Businesses’ struggles to get what they need has been multifaceted: High demand and bottlenecks have slowed international trade, the pandemic has transformed the workforce and exacerbated labor shortages and severe weather events have limited access to sources of some crucial materials.

The disrupted availability and quality of goods and services has affected both small businesses across the country and larger companies, such as car makers. The difficulties have left corporate leaders less concerned about cost and more focused on meeting customer demand.

Earlier Tuesday, Transportation Secretary Pete Buttigieg said the federal government is trying to alleviate short-term problems, like port congestion, while planning longer-term infrastructure spending to help relieve pressures on companies.

“We all know, as long as the pandemic exists, it will be poking holes in all of our supply chains,” he said.