TSMC Is Allegedly Raising Chip Prices Which Could Mean Bad News For PCs And Smartphones

TSMC Wafer
Frustrated by the global shortage of silicon that is causing cutting edge electronics to almost always be out of stock? You know, things like the latest game consoles (PlayStation 5 and Xbox Series X/S) and discrete graphics cards for gaming. Well, not only could the chip shortage linger through all of next year, but now there's a rumor TSMC is raising prices of its silicon.

If TSMC does actually increase the price of its wafers, you can bet those costs would be passed on to the consumer. After all, it's not like companies are keen to absorb higher manufacturing costs out of the goodness of their hearts—they are in this to make money for their owners and shareholders, obviously.

These are not necessarily small price hikes that loom, either. People who are supposedly familiar claim TSMC is looking at raising prices on the manufacturing side by as much as 20 percent, or even more.

The automobile industry would be hit the hardest, with those supposed 20+ percent price increases applying to silicon that gets used in vehicles, presumably to power edutainment consoles and things of that nature. They're described as being "less advanced chips," so perhaps it would not apply to AI silicon for autonomous chores.

Most of the "advanced" chips will see price increases of around 10 percent, sources told The Wall Street Journal. These could take effect by the end of the year, or in early 2022.

It's not clear if Apple would be paying a higher price as part of this alleged strategy, and if so, precisely how much. Apple is one of TSMC's largest customers, which produces chips that get injected into iPhone handsets, iPad tablets, and Apple Silicon-powered laptops.

News of the potential price increases come on the heels of multiple technology bigwigs warning that the shortage could last not only throughout next year, but into 2023 as well. In some shape or form, these warnings have come from Intel, IBM, and even TSMC.

At the same time, Intel and TSMC are investing billions of dollars into fab upgrades and expansions. So the silver lining is that any immediate price hikes as well as the shortage in general should all be temporary, to some extent. Are we having fun yet, folks?