Hewlett Packard Enterprise CEO says navigating the chip shortage won’t be easy — but end is in sight

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Antonio Neri

Anjali Sundaram | CNBC

Navigating the global chip shortage is going to be difficult, according to Antonio Neri, president and CEO of Hewlett Packard Enterprise, which sells hardware and software to businesses worldwide.

“It’s not going to be easy but I actually believe we’re going to be in a much better shape after the summer of 2022,” Neri told CNBC’s Karen Tso on Wednesday. His comments came in response to a question on whether the coronavirus pandemic could lead to further chip shortage issues.

New chip fabrication plants, known as fabs, will come online and create more capacity, Neri said, adding that this should alleviate some of the supply chain issues.

German technology and engineering group Bosch has built a new 1 billion euro ($1.2 billion) semiconductor plant in Dresden — the capital of the German state of Saxony and one of Europe’s biggest semiconductor clusters — over the last two years and production started in July.

Harald Kroeger, a member of the Bosch management board, told CNBC in August that supply chains have buckled in the last year as demand for chips in everything from cars to PCs and electric toothbrushes had surged worldwide.

Major chipmakers including TSMC, Samsung, and Intel have also announced new factories recently but they won’t be ready for several years and they will make advanced chips, which are more abundant than some of the older chips.

Neri said HPE has suppliers across the globe and the company is constantly thinking about how it builds its products. “We are becoming smarter about how we build products, the composition of the building materials, the ability to substitute components along the way,” he said.

Like many other companies, HPE has long-term agreements with its chip suppliers to ensure that it gets the chips that it needs, Neri said.

Gartner analyst Alan Priestley told CNBC Wednesday that PC buyers should try to be flexible when choosing their machines.

“If you want to buy a new PC, you have a lot of flexibility in terms of the type of CPU (central processing unit),” he said. “CPUs vary enormously in price. So, it may well be that your desired configuration is not available, but a different configuration is available. Consider alternatives.”

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