Russia's invasion of Ukraine could further strain supplies of semiconductor chips amid a shortage that has already caused global production disruptions for tech companies and automakers for more than a year.
Russia and Ukraine are critical sources of neon gas and palladium that are used to produce semiconductor chips, according to officials.
The U.S. neon supply, which is used for lithography processes for chip production, comes almost entirely from Ukraine and Russia, according to Techcet, a California-based market research firm that specializes in critical supply chain materials and components.
Russia produces neon, a gas that's a byproduct of steel manufacturing, which is then sourced and purified by a specialized Ukrainian company, according to Techcet. The price of neon shot up 600% the last time Russia invaded Ukraine in 2014.
"This will have an impact," Techcet President and CEO Lita Shon-Roy told CNBC during an online interview Thursday. "It will continue to constrain the chip source going into the automotive industry."