Sources: Samsung is talking to clients about hiking chipmaking prices by up to 20% in 2022, joining TSMC and UMC, who are planning another round of price hikes
Samsung Electronics Co. is talking with foundry clients about charging as much as 20% more for making semiconductors this year …
BloombergSohee Kim
Context & Ripple Effects
TSMC had already outlined roughly 10% increases for advanced chips and 20% for less advanced chips, establishing a higher-price backdrop before Samsung entered talks with its own foundry customers. With UMC also planning another increase, the reported Samsung move matters because buyers face pressure from multiple contract manufacturers rather than a single supplier.
The story is an early instance of the contracted semiconductor cycle: foundries are seeking to reset manufacturing terms across both advanced and less advanced production.
First-order effects
Samsung foundry customers negotiating 2022 production face prospective price increases of up to 20%, raising their chip procurement costs.
TSMC and UMC's planned increases mean Samsung is joining, rather than undercutting, an industry-wide push for higher foundry pricing.
Second-order effects
Chip designers and electronics makers have less room to use one foundry's pricing as leverage against another when Samsung, TSMC, and UMC are all seeking increases.
The pricing reset makes capacity commitments and contract terms more consequential for customers, since switching suppliers does not necessarily avoid higher manufacturing costs.
Third-order effects
If coordinated timing of price resets becomes recurrent, foundry competition shifts further toward available capacity and process capability rather than price alone.
The pattern points to a contracted semiconductor cycle in which supplier pricing power persists until customers regain meaningful production alternatives.
The trend: Semiconductor manufacturing is moving toward capacity-led pricing, with major foundries using constrained alternatives to renegotiate customer contracts.
TSMC, the world's biggest contract chipmaker, is planning to raise prices by “single-digit percentages” across both mature and advanced chip production technologies. The planned price hike will take effect by the beginning of 2023. https://asia.nikkei.com/...
The move translates into additional pressure on makers of smartphones, cars, and game consoles to lift the prices consumers pay. https://www.deccanherald.com/ ...
Scoop: Samsung looks to raise prices for making chips at its foundry business by as much as 20%, another sign of rising costs in the semiconductor business. via @soheefication https://www.bloomberg.com/...
EXCLUSIVE: Samsung Electronics is talking with foundry clients about charging as much as 20% more for making semiconductors this year, joining an industry-wide push to hike prices to cover rising costs of materials and logistics. https://www.bloomberg.com/...
EXCLUSIVE | SUPPLY CHAIN DISRUPTIONS IMMINENT TSMC has warned clients for the second time in less than a year that it plans to raise prices, citing looming inflation concerns, rising costs and its own massive expansion plans. https://asia.nikkei.com/...
TSMC plans another price hike amid inflation concerns - will be about 5-8% for different process tech, from cutting-edge to legacy nodes, making products from advanced processors, connectivity chips/sensors, to microcontrollers and power management ICs. https://asia.nikkei.com/..…
@soheefication @CLcrille I want to smoke what Samsung has. Losing some your biggest customers partially or entirely for the next gen (Nvidia, Qualcomm, Cisco) while trying to ram through YoY price increases on par with TSMC
Nikkei Asia followed up the TSMC price hike news, citing several sources, for a single-digit percentage price hike across mature and advanced processes, adding 2 sources said price hikes would be 5%-8% and are meant to stave off rising inflation. $TSM https://asia.nikkei.com/...