Large price increases for silicon chips from official distributors

Over the last 6 months we’ve all gotten hit by the massive silicon shortage that is affecting the electronics industry. Like many manufacturers, we’ve put in scheduled multi-year purchase orders to try and ‘get in the queue’ for when chips are available again.

Of course, if you don’t want to wait in line for up to 2 years (! yes we have gotten lead times into 2023) you could always go through the secondary market. However, you’ll see incredible price increases – chips that normally are $1 would be in the grey market going for $5 or more, depending on what the sellers think they can charge.

This week we experienced something new – an existing purchase order through an authorized disti for LSM9DS1s (https://www.st.com/en/mems-and-sensors/lsm9ds1.html) where the price has gone from about $4 per chip to over $15 per. we had never before had a purchase order from an official disti increase the price post-PO. we’re not sure exactly why ST decided to do this, but it’s probably something we’ll see happen more and more – so it’s a good warning to engineers that just because you see and book a part at one price does not mean you will get the actual part inventory at that price!