Robert Triggs/Android Authority
- Higher production prices may further exacerbate the global chipset shortage into 2022.
- According to a new report, chip makers will increase manufacturing costs next year, resulting in higher prices for chipsets and equipment that use them.
- This may mean that the cost of smart phones, computers and other electronic products may be higher in the future.
The global chipset shortage will have a profound impact in 2021, and some OEMs will find it difficult to meet demand after the pandemic. But this crisis may worsen, especially for consumers. A new report indicates that as production costs increase next year, the prices of chipsets and smartphones may deteriorate further due to higher prices.
According to a Nikkei Asia According to the report, Taiwanese semiconductor company TSMC-the chipset maker used by Apple, Qualcomm and Nvidia-will increase its production costs by as much as 20% in 2022. According to reports, this increase is due to a variety of factors, including strong demand and logistics to compete for smaller manufacturing processes. Other chip makers are also feeling these pressures.
The report also showed that the cost of sales of Qualcomm and MediaTek increased by 60% and 64% respectively from October 2020 to June 2021. This inflated cost and shortage may have a knock-on effect on consumers, who may have to fork even more electronic products. Smart phone and computer companies that rely on these chipset companies’ products may have to raise costs to make up for losses.
Higher prices, more flagships
Soaring prices may also affect the product lineup of smartphone companies. NikkeiQuoting Counterpoint analysts, the company may release more high-end products to offset losses. This means that there will be fewer new mid- and low-end devices available to consumers with limited budgets.
Interestingly, the rise in smartphone prices has not become a hot topic in 2021 as in the past. Compared with last year, Samsung and other companies actually lowered the prices of some flagship products this year. The Galaxy S20 series starts at US$999 in the US, while the Galaxy S21 starts at US$799. Galaxy S22 may not continue this trend. It is worth noting that Google also confirmed that its upcoming Pixel 6 Pro will be “expensive.”
It is not yet clear how much an increase in chip cost will have on smartphone prices, or whether OEMs are willing to take a bigger blow to protect consumers. Nevertheless, you may spend a few cents more to afford the new flagship in 2022.