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TSMC Price Hike: Microprocessor Costs Set to Rise by 25%

by Priya Shah – Business Editor

TSMC Plans Price Increases for Microprocessors, ⁢Citing Capacity Expansion

published: November 2, 2024 | Last Updated: November 2, ⁤2024

Taiwan ⁣Semiconductor Manufacturing Company (TSMC), the world’s leading‌ dedicated autonomous semiconductor foundry, is reportedly‌ planning ⁣to increase microprocessor production prices by approximately 10%⁢ beginning next⁢ year, according to a report by Digitimes. This adjustment is believed to be linked to ongoing investments in expanding production capacity in both the United States and Taiwan.

TSMC currently operates with limited direct competition in ⁢advanced semiconductor manufacturing technologies. While specific discount arrangements may vary, industry observers anticipate that these price increases will likely be passed ‌on ‍to customers, ultimately impacting consumer electronics pricing.

The cost of more advanced and complex manufacturing processes is⁣ expected to see the most importent price adjustments. Currently, production at TSMC’s Arizona facility is ​already approximately 15% more‍ expensive than equivalent orders placed at its Taiwan facilities.

According to Digitimes, TSMC ‌is considering ⁢a global price unification strategy. If implemented, this could possibly raise microprocessor prices produced in Taiwan by‌ as much as 25% – factoring in the existing 15% price difference ​between the US and Taiwan plants, plus the planned 10% increase.

Advanced Micro Devices (AMD) has ‌publicly acknowledged that utilizing US-based production units incurs a cost premium of 5% to 20% compared to ⁢Taiwanese production.⁤ The impact of these price changes on​ the European market remains uncertain, but industry analysts suggest⁢ price stability is unlikely.

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