(12-10-2021, 10:31 AM)Sleeprider Wrote: Please do not link to NYTimes. I will not support their pay-wall.  If you can summarize the article it would be more helpful.

(12-10-2021, 11:15 AM)Sleeprider Wrote: Thanks!  This makes me Wonder if the recalled machines are being salvaged primarily for chips?

(12-10-2021, 09:42 AM)btreger Wrote: [The New York Times]  "How the Supply Chain Upheaval Became a Life-or-Death Threat"

Quote:[ResMed]  “Medical devices are getting starved here,” the company’s chief executive, Michael Farrell, said in an interview. “Do we need one more cellphone? One more electric car? One more cloud-connected refrigerator? Or do we need one more ventilator that gives the gift of breath to somebody?”

ResMed has struggled to buy enough chips, Mr. Farrell said, constraining its ability to make a range of vital equipment — from ventilators used by Covid patients to breathing devices that sustain premature infants.  The company is “producing less than 75 percent of what our customers need,” Mr. Farrell said.

Mr. Farrell has found himself in an uncustomary role: beseeching his suppliers to allocate more of their goods to him so that his company can work through a growing backlog of orders.  By the time global industry figured out that demand for chips was surging, it was too late. Adding chip-making capacity requires as much as two years of lead time and billions of dollars.

In North America, Europe and elsewhere, medical device manufacturers are governed by strict product safety standards that limit their flexibility in adapting to trouble. Once a company like ResMed gains regulatory clearance to use a supplier, it cannot simply seek out a new one that might have a ready stock of chips without first going through a time-consuming approval process.

That meant that ResMed had to figure out how to squeeze more chips out of its existing supply chain.  Far from simple components, computer chips come in enormous varieties, each made with multiple parts that are typically made in multiple countries.  Faced with the prospect of getting shut out, Mr. Farrell rooted through his supply chain, identifying the suppliers of his suppliers, in the hopes of persuading them to prioritize ResMed’s factories.

Mr. Farrell soon realized that a primary reason that his chip supplier could not meet his demand was that — five levels up the chain — a Taiwanese manufacturer of silicon wafers had exhausted its inventory.  ResMed’s orders amounted to barely 1 percent of the wafer company’s output. A mere fraction of 1 percent in additional wafers was enough to satisfy ResMed’s needs.

A massive recall of the devices by a big manufacturer further reduced supply.