Chip manufacturers have started to increase prices due to the global chip storage

[jsilva]

In brief: Electronics pricing might become even worse than it currently is. A new report suggests that some chip manufacturers have increased their products' pricing by 10% to 30% since the start of Q2 2021. Moreover, the prices of IC products have also been significantly increasing, in some cases by dozens of times.

With the start of the second quarter of 2021, over 30 companies, including UMC, SMIC, and PSMC, have reportedly increased their products' prices by 10% to 30% due to rising raw material costs. Although TSMC isn't mentioned in the report, the semiconductor company had already done something similar in January 2021, increasing the wafer pricing and terminating discounts.

The price increase varies depending on the type of product. For example, signal chain chips increased by 10% to 20%, while memory ICs and power management chips increase by up to 30%. All in all, the price increase averages about 10-20%.

The report also mentions that "the prices of some IC products have soared dozens of times," making it harder for small and medium-sized businesses to stay afloat in these troublesome times. If the situation doesn't improve over the coming months, some of these businesses will likely go bankrupt.

Prices of products should also increase proportionally to the number of chips it uses. If a product only uses a power management chip, the increase shouldn't be that noticeable. However, if it uses multiple chips that have become more expensive, it's only logical to see a more significant price bump.

The ongoing chip shortage has been devastating to the electronics industry. Cars, PC components, TVs, consoles, and other products have already been severely affected, but Sony's and AMD's CEO hope the situation will improve this year.

Image credit: Umberto

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https://www.techspot.com/news/89802-chip-manufacturers-have-started-increase-prices-due-global.html

 

[QuantumPhysics]

There are a lot of cars that can't even sell right now because they don't have enough chips for their computers.

Hopefully, the demand forces the makers to do more to meet the supply in the future.

 

[veLa]

That would be a great example of the economic forces known as supply and demand hard at work.

 

[TheBigFatClown]

I keep hearing this but I dont see flash memory prices going up too much on SSDs or micro SDHC cards. Will they be affected also?

 

[Rayneofpayne]

I keep hearing this but I dont see flash memory prices going up too much on SSDs or micro SDHC cards. Will they be affected also?

Yes, they said DDR5 will come at a premium due to rising costs.

 

[Rayneofpayne]

That would be a great example of the economic forces known as supply and demand hard at work.

Unless the demand has been the same and they artificially create scarcity or use any reason to raise prices like they have in the past, like purposely cutting production to cause price hikes.

 

[Dimitriid]

Ah so they're finally moving into the "fixing" part of their "price fixing" strategy. I am also positive about the mere coincidence that this move is done now that Bitcoin recently crashed big time and there's a possible slow down on ASIC and GPU miners in the near future: sure that has no influence on them thinking about how to retain some of the markups they had.

 

[Eldritch]

Ah so they're finally moving into the "fixing" part of their "price fixing" strategy. I am also positive about the mere coincidence that this move is done now that Bitcoin recently crashed big time and there's a possible slow down on ASIC and GPU miners in the near future: sure that has no influence on them thinking about how to retain some of the markups they had.

Bitcoin is the most ridiculously inefficient currency in current world but people who don't understand its working and costs simply keep on babbling 'But mah Blockchain!' and going gaga over it.

People need to be straight about things. They don't have interest in crypto.
They just wanted free money that grows infinitely. Except for some early joiners (sounds a bit like pyramid scheme doesn't it?) none of the above is true. You spend huge amounts of money, electricity and take risk for something that is more akin to a roller coaster then money.

We need to educate people about stock markets. You can have all your gambling fix (yes crypto is basically gambling now) in stocks and guess what it is more stable too!

Want some crazy risks? Feeling adventurous? Well, why don't you invest in that brand new venture and see how things go! Heck, you can do some commodity, futures speculation. Stop hogging our hardware for silly cryptos. Do stock trading FFS.

 

[Kosmoz]

Want some crazy risks? Feeling adventurous? Well, why don't you invest in that brand new venture and see how things go! Heck, you can do some commodity, futures speculation. Stop hogging our hardware for silly cryptos. Do stock trading FFS.

Why? Because it's easier to do with crypto, than all of the above. No matter how you view it, that's the answer, it's easier to "play" with crypto. If one is successful or not, that's a different subject.

 

[Eldritch]

Why? Because it's easier to do with crypto, than all of the above. No matter how you view it, that's the answer, it's easier to "play" with crypto. If one is successful or not, that's a different subject.

I beg to differ. It's incredibly easy to do stock transactions nowadays. There are many apps that make stocks as easy as buying burger for beginners. Going into the nitty and gritty, of anything under the sun, is another matter altogether.

 

[Kosmoz]

I beg to differ. It's incredibly easy to do stock transactions nowadays. There are many apps that make stocks as easy as buying burger for beginners. Going into the nitty and gritty, of anything under the sun, is another matter altogether.

Really? I don't know, I'm talking as a newbie myself, from my POV, if anything crypto help, tutorials, marketing, etc is EVERYWHERE and I can learn almost without wanting how to do it (the basics), but the other stuff you say it's not even close to these levels of exposure or easiness...

There are many reasons why crypto is so popular now, more than anything else, this is one of them.

 

[Yppah]

Really? I don't know, I'm talking as a newbie myself, from my POV, if anything crypto help, tutorials, marketing, etc is EVERYWHERE and I can learn almost without wanting how to do it (the basics), but the other stuff you say it's not even close to these levels of exposure or easiness...

There are many reasons why crypto is so popular now, more than anything else, this is one of them.

"but the other stuff you say it's not even close to these levels of exposure or easiness"

NO. The stuff that was said (Stock Market) has FAR more exposure and guides dedicated to it. Been a round for MUCH longer. Has a LARGER presence. Use Search buddy. Some ppl..

 

[Kosmoz]

"but the other stuff you say it's not even close to these levels of exposure or easiness"

NO. The stuff that was said (Stock Market) has FAR more exposure and guides dedicated to it. Been a round for MUCH longer. Has a LARGER presence. Use Search buddy. Some ppl..

Dude, do you understand that from the POV of someone who is not initiated in these things, I see crypto stuff everywhere, but all the old investent "stuff" you mention is considered not-so-interesting, is not nearly as attractive and is not everywhere? Do you get that?

I don't need to use search to see crypto stuff, it's everywhere, especially on the net, I'm almost forced fed with it - do you get that?
I don't care if you are a pro or whatever, you're an ignorant to the masses of the populace, which are not pros/connoisseurs at this stuff and they get more easily attracted to cryto, because of all of the above reasons.

Yeah, some people...

 

[BillM1]

There are a lot of cars that can't even sell right now because they don't have enough chips for their computers.

Hopefully, the demand forces the makers to do more to meet the supply in the future.

The issue is that many autos (except Toyota) decided to NOT order their ICs. Toyota continued to order and has no issues.

The auto mfgs thought they could do the same style of business as they do with their other suppliers (batteries, tires, engines, etc). What auto mfgs did not realize was the world's insatiable demand for silicon in many products and the lead time to mfg those chips (months). The fabs can and did resell open wafer slots to other non auto mfg customers. Shame on auto mfgs for not understanding how THE key component in new cars is produced. I worked in semiconductor for 18 yrs and then over in EDA software side for another 18 years. This phenomenon has existed since 1980s.

Demand will ease but new fabs take years and $billions to build and get production ready.