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News hardware & software 25 May 2021, 13:11

author: Arkadiusz Strzala

Chip Prices Increased by 30%; Electronic Components Price Hike Inbound

The announced increases in chip prices are becoming a reality. A large part of manufacturers are raising them as we write these words, and some have already done so. Differences reach up to 30%, depending on the type of chip.

IN A NUTSHELL:
  • Some silicon wafer manufacturers have already raised their prices - by up to 30%, depending on the purpose of the chips cut from them.

The alarming predictions are slowly becoming a sad reality. According to this report, more than 30 chipmakers have already raised their prices. This is due to the increased production cost of silicon wafers and the general shortage of components. Among the manufacturers who have announced price changes are UMC, SMIC and Power Semiconductor Manufacturing. Interestingly, TSMC is not on that list - the Taiwanese manufacturer seems to be shying away from the increases, even though they were announced this March.

ICs are produced in the form of silicon wafers, from which individual devices are cut. What has changed are the prices of these entire wafers. The increase depends on the type or purpose of the chip. Those that control power supply will experienced bigger hikes, even by 30%, while signal chips only up to 20%. It should be remembered, however, that each device or circuit requires energy supply by other chips intended for this purpose. Therefore, this distinction becomes insignificant.

Increases will affect the prices of all electronic devices. The increase will also apply to NAND (SSDs) and DRAM, as reported by DigiTimes. Differences may reach double-digit percentages. The main reasons cited are rising demand, shortages of filtered water in some factories, the global Covid-19 situation and rising component prices (e.g. controllers in the case of SSDs).

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