TSMC Said to be Planning Price Increases in 2023

[TheLostSwede]

The global inflation rises are no secret and more and more companies are looking to increase prices of their goods, so not entirely unsurprising, reports of TSMC planning price hikes in early 2023 are starting to appear. TSMC has supposedly already contacted its customers to notify them about the upcoming price increase, to give them as much time as possible to make any changes to their plans, if needed. The price increase will vary depending on the node in question, but is reported to be somewhere between five and eight percent according to the Nikkei.

Part of the increase is also related to TSMC's rapid expansion that's going on at the moment, since the company is going to need to invest a lot more capital when it comes to building the advanced fabs that its customers are relying on. TSMC is expected to invest some US$40-44 billion this year alone on fabs and new equipment. This is a fairly small price increase compared to the big increase TSMC implemented in August 2021, where some nodes saw price hikes of up to 20 percent. That said, TSMC isn't alone in increasing their pricing, as UMC and SMIC have also increased their prices several times since last year. Nikkei claims that UMC and SMIC are charging more than TSMC on some nodes. However, in the past, TSMC used to offer discounts to its clients on a quarterly basis once a chip had gone into mass production and everything progressed smoothly, but TSMC discontinued this discount scheme last year. As such, it looks like cheaper chip costs aren't to be expected any time soon.



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[stimpy88]

This lot learned their position quickly. I only see bad things coming from them and their industry monopoly in the future.

I really hope somebody else can catch up with them and offer an affordable alternative one day soon.

 

[ExplodingCaps]

Ah sh*t, here we go again.

 

[Prima.Vera]

Everything raises, prices, taxes, living expenses...
One thing that stays the same are the salaries.... Fking Capitalism...

 

[FreedomEclipse]

Well... at least they didnt try to hide it behind a power outage, a factory fire, a tsunami, an earth quake or any other natural disaster this time around. Just a straight up "we're gonna charge you more"

I dont like it but i can respect that.

 

[Rexter]

TSMC in 2024:
"2023 was a record year with the highest ever recorded profit since this company was founded".

 

[DeathtoGnomes]

Updating a production machine, eventually gets to the point where maintenance and repair costs become higher than a replacing with a new unit. Besides, new machines could feature better accuracy or is more efficient, or even less power consumption.

Such changes are always passed on to the consumer, not that it would hurt their profits if they didnt.

 

[TheinsanegamerN]

Everything raises, prices, taxes, living expenses...
One thing that stays the same are the salaries.... Fking Capitalism...

I guess you havent noticed how hourly pay at the low end has increased by over 50% in the last two years? That gosh darn capitalism......

TSMC in 2024:
"2023 was a record year with the highest ever recorded profit since this company was founded".

TSMC in 2024:
"We are planning on increasing prices to cover higher operating costs"
TSMC in 2025:
"2024 was a record year with the highest ever recorded profit since this company was founded".
Ece.

 

[DeathtoGnomes]

I guess you havent noticed how hourly pay at the low end has increased by over 50% in the last two years? That gosh darn capitalism......

wait wait are you being sarcastic here? How dare you use facts not in evidence!!! it was 49.9% not 50%, be precise (required only on TPU ).

 

[cosminmcm]

Again? I thought the margins were high enough already.

 

[Deleted member 24505]

Well that's AMD fucked

 

[DeathtoGnomes]

"Let's see if we increase batch prices by only 11.5 cents, we can pay our workers more too, say 5 cents and call it 50%!. Yea thats what we'll do!! BUT, only as long as it doesnt decrease our yearly 25% profit margin!"

I would not be surprised if this was not that far from the truth.

 

[Aretak]

I guess you havent noticed how hourly pay at the low end has increased by over 50% in the last two years? That gosh darn capitalism......

Where? In what country? Cite specific examples please.

 

[mechtech]

With all the big price jumps over the past 3 years their “reasoning” that’s it’s too expensive to fab in the states might be losing accuracy.

 

[medi01]

That is why (near) monopolies are bad, folks.

Hopefully Samsung can step it up.

not entirely unsurprising

Chuckle.

 

[Space Lynx]

This lot learned their position quickly. I only see bad things coming from them and their industry monopoly in the future.

I really hope somebody else can catch up with them and offer an affordable alternative one day soon.

Intel will keep the balance I expect, also in 2025 I expect a lot of market saturation... so prices will come down then. I'm just glad I got my PS5 at MSRP and most of my other stuff, pretty much all entertainment I own right now should last me a solid 8 years of enjoyment... except my phone, it only has about 5 years in it... but yeah if the world wants to poop itself, by all means it can, because I already got mine!

 

[TheinsanegamerN]

Intel will keep the balance I expect, also in 2025 I expect a lot of market saturation... so prices will come down then. I'm just glad I got my PS5 at MSRP and most of my other stuff, pretty much all entertainment I own right now should last me a solid 8 years of enjoyment... except my phone, it only has about 5 years in it... but yeah if the world wants to poop itself, by all means it can, because I already got mine!

Nope. JIT supply can only catch up if there is a major downturn in demand, and given hwo demand for chips is only going up market saturation will not happen this decade.

 

[trsttte]

Nope. JIT supply can only catch up if there is a major downturn in demand, and given hwo demand for chips is only going up market saturation will not happen this decade.

... or if there's a major increase in capacity, or a bit of both (which I suspect is what's happening).

 

[TheinsanegamerN]

... or if there's a major increase in capacity, or a bit of both (which I suspect is what's happening).

Every increase in capacity will be met by increased demand.

Take today, say you increased capacity by 50% and could meet current demands....Welp, EVs are slated to be forced upon us as our only option for cars, and they take 2-3x as many chips to make as a gas car. So right back to square 1. Everything else in our life needs more chips, and thanks to planned obsolescence they all need periodically replaced. The demand there will only grow as more peole demand "smart" appliances and "smart" homes that need constant upgrades.

That major upgrade in capacity would also need to be met with increased transportation to handle said supply, and that is only predicted to get worse.

Welcome to clown world.

 

[95Viper]

Stay on topic.
Stop the political BS and hate.

 

[Aquinus]

Hey, a lot of companies depend on TSMC and they're competing for their newest nodes. TSMC needs to expand capacity and that takes capital and you need to offset that investment somehow until those fabs are operational and can start producing revenue. At the end of the day, TSMC needs to make sure that their strategy is financially sound and it sounds like they've considered all of this. It's hard to get mad when they continue to make great progress to be completely honest. A lot of other things (at least here in the US,) have gotten a heck of a lot more expensive than this.

 

[Fourstaff]

No surprises here, every other company has been taking this inflation opportunity to increase their profits. For their most advanced nodes, they can name a price and everyone else will have to pay but for the older nodes I think their pricing power is still bounded by competition especially from Samsung. Of course, they can form informal cartels ...

 

[simlife]

I guess you havent noticed how hourly pay at the low end has increased by over 50% in the last two years? That gosh darn capitalism......


TSMC in 2024:
"We are planning on increasing prices to cover higher operating costs"
TSMC in 2025:
"2024 was a record year with the highest ever recorded profit since this company was founded".
Ece.

ummm no it hasn't i work as a vendor for grocery stores(and in store directly for 8+ years) and the base pay increase is only about 12% higher the last 2 years.... its about 30-35% higher if your going to work nights...AND that is 100% because the worker shortage not because super rich company's want to pay well. fast food is about the same i know a guy working for 9 bucks a hour at a coffee shop he gets free coffee and tips but thats it

 

[evernessince]

I guess you havent noticed how hourly pay at the low end has increased by over 50% in the last two years? That gosh darn capitalism......

No, that's pay your workers more or they won't be able to live. Wages have been outpaced by inflation for decades. Now that's capitalism. Meanwhile Bezos pays switzerland to remake a bridge so his yacht can fit under it.

In any case I am very well tired of these price increases as I am sure everyone else is.

 

[Minus Infinity]

Let me guess it's Ukrainian war. Coking coal is up, so wafers are up just like food.