Hi folks, first post, so be gentle 😆, but I have about 30 years as an engineer and manager in the semiconductor industry. I've also played bass on and off for longer than this. I also play keyboards.
There's a few problems going on here. Firstly the s/c industry was growing at about 5% per year for the last few years, and then, bang, all of a sudden last year demand was +20%. There were pandemic related issues as well and some fabs (mostly in Asia) shut down for a while, so that capacity was lost. The car companies believed that demand had tanked long term and so cancelled future orders. This capacity was then assigned to other things.
Don't blame me though, where I work never missed a minute and has been posting record results every month since the start of this.
There were also some capacity issues due to fires and a few more fabs have been running on reduced capacity.
Finally, the investment needed (and time required) for a state of the art chip factory is eye watering. You're talking over $5 billion and at least 3 or 4 years to build, start up, and qualify a new factory, so it's not a case of just buying a few more machines and putting them in an extension out the back.
Over the past 30 years the cost of staying in the game has risen exponentially as the technology gets more and more complex (read "smaller"). For the latest chips, there's one manufacturing machine alone that costs around $175 million (and that's not a typo) and guess what ? You needs dozens of them. If you're interested google ASML or "extreme UV lithography".
Most of the smaller companies have exited the market and manufacturing has become concentrated in certain geographical areas (yup, mostly Asia).
Making high end semiconductors is, without any doubt, the most advanced manufacturing process in the world.
Hope this is of interest.