Semiconductor disruption

The Middle East conflict is severely disrupting European semiconductor imports. Rerouted air freight, due to attacks on regional infrastructure, has reduced capacity by 9% and increased fuel costs, leading to higher delivery fees. Companies are depleting backup inventory, with lower-value chip importers facing the biggest impact. Delays are common, adding to existing supply chain complexities. While some major players report no current production issues, the industry is stress-testing flows and rebalancing inventory in real-time due to geopolitical instability.