Gadget prices to rise after world's biggest chip maker - which supplies Apple - is hit by Covid computer chip crisis
The cost of electronic gadgets is set to rise after the world's biggest chip maker announced it has to increase its prices by up to 20 percent because of a global parts shortage.
Taiwan Semiconductor Manufacturing Co. - whose biggest customer is Apple - said its more advanced chips would go up by around 10 percent due to a lack of semiconductors.
The company's less advanced chips, such as those used by car manufacturers, are set to go up by 20 percent, it said, according to a Wall Street Journal report.
The cost of electronic gadgets is set to rise after the world's biggest chip maker announced it has to increase its prices by up to 20 percent because of a global parts shortage
Taiwan Semiconductor Manufacturing Co. - whose biggest customer is Apple - said its more advanced chips would go up by around 10 percent due to a lack of semiconductors
TSMC's price hike is set to take effect from January next year, with the company passing the cost increase of making the chips to its customers - like Apple - who in-turn could pass the cost onto their own customers.
As a result, some up-coming electronic products such as Apple's iPhone 13 could be more expensive than the tech giant's previous iterations of its flagship product.
The report about the price increase comes amid a global semiconductor shortage that has caused chaos for the manufacturing industry.
The shortage has caused a major delay in manufacturing activity, with automakers cutting down on production and electronic device makers struggling to keep up with a pandemic-led surge in demand for phones, TVs and gaming consoles.
Electronic markers have been reporting prices for chips rocketing by up to 600 per cent, and the shortage is threatening to shut down swathes of the car industry across the world.
In its latest earnings call, Apple warned that the global chip shortage - which has already hit production of iPad tablets and Mac computers this year - would affect the production of the iPhone later this year.
The report about the chip price increase comes amid a global conductor shortage that has caused chaos for the manufacturing industry. Pictured: A microchip (stock image)
Meanwhile, Toyota, Ford, Volkswagen and Stellantis indicated they were poised to slash production due to a lack of the vital components.
Production of the latest generation of gaming consoles - the PlayStation 5 and XBox Series X - are also among the products hit by the shortage, with CEO of Intel Pat Gelsinger saying earlier this year he expected the shortage to last into 2022.
Many were forced to close shop in the depths of the pandemic and since reopening they have had to battle electronics makers for supplies of the chips.
Microchips are are used in everything from vehicles to smartphones and home appliances.
Last month, TSMC said the auto chip shortage would gradually ease for its customers from this quarter but it expected overall semiconductor capacity tightness to extend possibly into next year.
TSMC did not immediately respond to a Reuters news agency request for comment.
Taiwan is doing all it can to address the global shortage of semiconductors, Economy Minister Wang Mei-hua said on Tuesday after talks with the newly appointed de facto U.S. ambassador in Taipei.
Car companies such as Toyota, Ford, Volkswagen and Stellantis indicated they were poised to slash production due to a lack of the vital components. Pictured: A Toyota factory (file photo)
Taiwan Semiconductor Manufacturing Co. - whose biggest customer is Apple - said its more advanced chips would go up by around 10 percent due to a parts shortage, and its less advanced chips as much as 20 percent. As a result, some up-coming electronic products such as Apple's iPhone 13 could be more expensive
The announcement comes as Covid surges in parts of Asia where large numbers of chips are made, including Japan, the Philippines, Thailand, Vietnam and Malaysia.
Japan's Toyota, which had previously managed to avoid shutdowns by stockpiling chips, said it would be forced to slash production globally by 40 per cent in September.
The firm owns a plant in Deeside, North Wales, although it did not specify whether that would be affected.
Germany's Volkswagen said it could not rule out further changes to production, due to 'volatile' chip supplies.
Meanwhile Citroen and Fiat owner Stellantis said it would halt or cut production at two plants in France.
US giant Ford had also said earlier this week that it would halt production of its best-selling F-150 pickup truck in Kansas City.
In some cases, the ongoing disruption has forced car companies to divert components to their most profitable models. Bosses warned that more disruption is expected.
No comments