Chip Prices Are Going Up, And Electronics Prices May Soon Follow

Chip Prices Are Going Up

TSMC, the world’s largest chip maker, is planning to raise its price up to 20%. Now that chip prices are going up, it will impact the consumer’s pocket especially the Apple users as they will be the cutting edge for paying the increased cents.

Mr. Mark Liu said,

“TSMC is finally going to increase their prices to go with the trend, making up for misallocating their capital spending.”

When Chip Prices Are Going Up?

Taiwan Semiconductor Manufacturing Corporation planned to increase the price by 2022. Chip prices are going up for both most advanced and less advanced chips by 10% and 20% respectively.

One of the biggest consumers of TMSC chips is Apple Inc. So, it can be assumed who will get affected the most. Alongside, other big corporations like AMD, Qualcomm, General Motors Corp, and Toyota Corp will also get affected.

TMSC is not alone; the chip production prices of GlobalFoundries, Powerchip Semiconductor Manufacturing (PSMC), Semiconductor Manufacturing International (SMIC), and United Microelectronics (UMC) have also been increased in the effect of growing demand.

In India also, business-like Reliance Jio also gets affected. That’s why Jio has delayed its cheapest 4G-enabled smartphone launch. Further, the cause of the increase in the chip price is the shortage of semiconductor chips in the global market.

As per sources, TMSC will spend $100 Billion on its semiconductor output unit and R&D. For this purpose, it started expanding its construction unit to Nanjing, China while a construction unit has started in Arizona.

While the prices will hike, the demand for chips in making laptops and PCs will also be affected. In times like pandemics and after, the sense of working remotely is supposed to be extended.

TMSC earns 90% of revenue only from chips and produces about half of the global market. In such a scenario, if chip prices are going up even by 10%, there will be a great impact on its consumers. Eventually, it will be the common people who will have to deal with this burden.