World's Largest Chip Maker to Raise Prices, Threatening Costlier Electronics

[Zorro]

Source: Wall Street Journal

TSMC to increase prices of most advanced chips by roughly 10%; less advanced chips will cost about 20% more

The world’s largest contract chip maker is raising prices by as much as 20%, according to people familiar with the matter, a move that could result in consumers paying more for electronics.

Taiwan Semiconductor Manufacturing Co. plans to increase the prices of its most advanced chips by roughly 10%, while less advanced chips used by customers like auto makers will cost about 20% more, these people said. The higher prices will generally take effect late this year or next year, the people said.

Apple Inc. is one of TSMC’s largest customers and its iPhones use advanced microprocessors made in TSMC foundries. It couldn’t be determined how much more Apple would pay.

A TSMC spokeswoman declined to comment on prices but said the company works closely with customers. An Apple spokeswoman didn’t immediately respond to a request for comment.

Read more: https://www.wsj.com/articles/worlds-largest-chip-maker-to-raise-prices-threatening-costlier-electronics-11629978308

[bucolic_frolic]

1. With so much competition

will consumers be willing to pay more? Or will they make the already very good tech they have last a while longer?

[Eugene]

3. There's a worldwide shortage, and the semiconductor market is an oligopoly.

Interestingly, TSMC is one of the loudest voices against diversifying the marketplace.

[bucolic_frolic]

7. Yes so there's companies and industry pushing the narrative that began in the COVID production slump

A season of slower sales from consumers deciding to keep their old still useful technology another year or two will pop this inflation and shortage angle.

We are so being played at the drop of every hat!

[Polybius]

2. I thought Intel was the largest

I guess I'm old. Oh well, at least I didn't say Motorola.

[Hugh_Lebowski]

16. Intel are indeed huge, but they're on an outdated fabrication process

Probably not technically accurate to say TSMC is the 'largest' but they're among the largest and they are using the most advanced process, basically meaning they're packing the most computing power into the smallest surface area.

[ananda]

4. This is why I took the 8-year warranty on my car.

They told me this would happen at the dealership.

[keithbvadu2]

5. Good thing that Foxconn chip plant in WI can take up the slack for America.

Good thing that Foxconn chip plant in WI can take up the slack for America.

You know, the gazillion dollar plant that Trump and Walker negotiated.

[cstanleytech]

8. Chip plant? I thought they were supposed to build a plant to build displays not chips.

[keithbvadu2]

11. OOPS! Yeah. Displays. They are huge in chips also. I figured they could revamp.

OOPS! Yeah. Displays. They are huge in chips also.

I figured they could revamp.

https://www.google.com/search?client=firefox-b-1-d&q=foxconn+chips

[Hugh_Lebowski]

15. I think they're trying to into chips but mostly they make tons of products that use chips

Made by others.

Hence their trying to get bigger in the chip business, but they're not a big player.

[iscooterliberally]

6. I guess I'll hang onto my iPhone 6 and my old cars for a while longer then.

I only use my phone for texting and GPS, oh and sometimes phone calls too! Our cars are old, but they're paid for and we have a great honest mechanic. We'll try to ride this out for a while and see what happens.

[ripcord]

9. I'm relieved, I thought my Doritos supply was in danger

[lonely bird]

10. There are raw material issues all over the place

Commodity chemicals have been and are continuing to go up in price. These are basic chemicals used every day. There are raw material availability issues for paints and coatings including emulsions, MDI (methylene diphenhydramine diisocyanate) which is used in polyurethanes and polyureas and amines used in curing agents for epoxies. Titanium dioxide, white pigment, has gone up.

Some of this is traceable in the U.S. to the storm in Texas early this year that shut down the petrochemical plants when the grid failed. Imo, some is traceable to rebounding demand from COVID. That being said companies are taking the opportunity to jack up prices.

The cost for shipping a 40’ shipping container has gone up as much as 3-5 times and in some cases 6-7 times. Enormously long supply chains combined with “Just-In-Time” delivery (read: not in time) and COVID has caused chaos.

And there is profit in chaos.

[cstanleytech]

13. I think the biggest problem now is that there simply are not enough fabs to meet the demand thus the

fabs feel its safe to raise prices for now.
Now some companies are looking at building their own fabs but until that actually happens the current fabs know that they are the only game in town for companies that need the chips they can produce.

[Jetheels]

12. Likely to be the reason China wants to take over Taiwan. Nt

[Hugh_Lebowski]

14. Except that they've wanted to do that pretty much ever since there WAS a Taiwan (nt)

[Calista241]

17. Also one of the reasons we don't want China to take over Taiwan. n/t

[Bengus81]

18. The price of video cards has been ridiculous for a year or more so go ahead a jack the price more

I remember when they pulled this stunt a few years back with memory because of all the supposed "miners" of crypto coins. It worked for awhile and then prices dropped like a rock.