TSMC Plans Price Increase on Advanced Process Technologies in 2024
TSMC, the world's leading semiconductor foundry, has been making preparations to implement a price increase across its advanced process technologies. Expected to take effect in January 2024, the price increase is believed to be necessary for TSMC to offset rising costs and maintain its profitability.
While this move will undoubtedly impact the semiconductor industry and potentially lead to higher consumer prices, TSMC's market dominance suggests that the company will be able to pass on the price increase to its customers without significant repercussions.
The price increase will be applicable to all TSMC's advanced process technologies, encompassing 5nm, 4nm, and 3nm nodes.
However, TSMC has yet to provide a comprehensive breakdown of the specific price adjustments. Reports indicate that the extent of the increase will depend on factors such as the production method, order quantity, and degree of collaboration. This tailored approach ensures that customers with varying requirements will experience price adjustments commensurate with their individual circumstances.
The forthcoming price increase by TSMC is expected to have a substantial impact on the semiconductor industry in 2024. As numerous companies heavily rely on TSMC's manufacturing services, they may find themselves compelled to raise their own prices to compensate for the increased costs.
Consequently, consumers could encounter higher prices for a range of products reliant on semiconductors. Despite the potential for increased prices across the industry, TSMC's position as the leading semiconductor foundry worldwide provides a significant advantage. Given the high level of trust and collaboration between TSMC and its major customers, it is unlikely that these clients will readily switch to alternative suppliers in response to the price increase.
TSMC's ability to pass on the price hike to its customers without suffering significant business losses remains intact. As TSMC prepares for a price increase on its advanced process technologies in January 2024, the semiconductor industry braces for the potential repercussions. While the price adjustment is deemed necessary by TSMC to counter rising costs, it is expected to lead to subsequent price increases for consumer electronics and other products reliant on semiconductors.
Nonetheless, TSMC's market dominance and strong customer relationships position the company to weather this price increase with minimal disruption to its business. The coming months will shed light on how this development will impact the semiconductor industry and consumer markets.