TSMC reportedly ends volume discounts for its 12-inch foundries

According to the Central News Agency, a news organisation in Taiwan, TSMC, one of the world’s largest semiconductor manufacturers, has reportedly ended volume discounts on their foundry products for 12-inch wafers, effectively increasing their prices. 

If this report is correct, this will remove a discount of around 3% from TSMC’s foundry pricing in 2021, making it more expensive for companies like Apple, AMD and Nvidia to produce their products using the foundry. Analysts have called this move a think veiled price increase. 

Today, TSMC’s products are in high demand, with Apple transitioning their CPUs to TSMC manufactured Apple Silicon while other customers like AMD are finding it difficult to keep their latest 7nm products in stock at retailers. The electronics market is booming, and that demand is putting strain on TSMC’s manufacturing capabilities. 

The removal of this foundry discount will cut into the margins of TSMC’s customers, making their products less profitable. That said, should TSMC offer a discount when they are having no trouble allocating all of their premium foundry space?  
 

  
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