We’ve been talking for some time about the processor shortage and that this shortage affects both the manufacturing of the devices and the usual prices of these crucial components. Nikkei Asia reports that TSMC, Apple’s main supplier, is preparing for a historic price hike.

Too many orders, many of them bloated

As Nikkei noted, TSMC has always moved with prices around 20% higher than its competitors. Now with the shortage of components some of its competitors are already forced to charge more than the same company. And all of this as TSMC gears up for one of the biggest price hikes of the past decade, an increase that can have a major impact on much of the industry.

These higher prices are due to a number of factors, such as rising costs for materials and logistics, as well as the scramble of device manufacturers to ensure an adequate supply of chips, which have emerged since the chip shortages began to affect late last year. ”

According to sources seen by Nikkei, the company wants to end a practice known as “double-booking” in which TSMC customers ask for more chips than they need in the hope of securing security. production. As a result, the company cannot know the real demand it is facing.

Higher prices, among other things, to discourage manufacturers from ordering more components than they actually need.

According to Counterpoint, TSMC’s predicted price hike could have a significant impact on smartphone makers, many of which only have a 5-10% profit margin. With this, it is expected that between this year and next year, we will see an increase in prices in the terminals to mitigate the additional costs.

A few weeks ago, we saw how TSMC’s price hike would affect Apple just at a time when it needs more processors than ever, as they made the leap from the iPad and iPhone to the Mac. Apple’s size allows it to negotiate more favorable terms. with its suppliers, but it’s too early to rule out that we may see a slight price increase on devices this year, starting with iPhones.

For now, the processor and component crisis seems to be going from bad to worse. Many reports claim that we will continue in a similar situation in 2022, although it is clear that at some point we may turn the tide. For now, while waiting for the announcement of the iPhone 13 presentation event, we can only wait to see its official price on stage to draw some conclusions on the effect that the price increase of TSMC could have on the final price of the iPhone.

Image | Umberto