TSMC raises U.S. prices as companies rush to place orders
TSMC (Taiwan Semiconductor Manufacturing Company) has raised its U.S.-based foundries’ quotations by 30 percent. It is able to do this and still receive a flurry of massive orders from American companies because the current tariff uncertainty has made it difficult to conduct business internationally.
TSMC doesn’t have its most advanced plants in the U.S. but companies like Apple and Nvidia are investing in its stateside operations regardless. Though President Donald Trump has exempted most electronics from his tariffs, the entire global supply chain is very volatile at the moment.
Previously it was thought that most companies would not care to order chips from TSMC’s U.S. factories. This has now changed as continuing to do business with Taiwan might lead to massive problems down the line if the president ever changes his mind on the tariff exemptions. As such TSMC is now able to increase prices and make a profit while still having orders flying in.
Tariffs have been applied to almost every region in the world. The idea behind them is to force companies to move their production back to the U.S. instead of relying on cheaper labor abroad. This has sent companies into a panic and led to them hoarding inventory in the U.S. to delay the effects of tariffs for as long as possible.
Fortunately for Apple and similar companies the president recently exempted most electronics from these tariffs. However, given how unpredictable the entire ordeal has been, I think everyone expects new tariffs or something similar to be announced very soon. This has made TSMC’s stateside foundries more important than anyone could have predicted.
Current estimates claim that moving production to the U.S. — a monumental and unlikely task — will make products drastically more expensive. Others claim that this is the first painful step of an otherwise much better future. Whichever outcome ends up happening, the stock market has not been happy these past couple of weeks.
And companies like Apple and TSMC are probably pulling out their metaphorical hair trying to make sense of it all.
Previously it was thought that most companies would not care to order chips from TSMC’s U.S. factories. This has now changed as continuing to do business with Taiwan might lead to massive problems down the line if the president ever changes his mind on the tariff exemptions. As such TSMC is now able to increase prices and make a profit while still having orders flying in.
The iPhone 16 uses Apple silicon chips manufactured by TSMC. | Video credit — Apple
Tariffs have been applied to almost every region in the world. The idea behind them is to force companies to move their production back to the U.S. instead of relying on cheaper labor abroad. This has sent companies into a panic and led to them hoarding inventory in the U.S. to delay the effects of tariffs for as long as possible.
Current estimates claim that moving production to the U.S. — a monumental and unlikely task — will make products drastically more expensive. Others claim that this is the first painful step of an otherwise much better future. Whichever outcome ends up happening, the stock market has not been happy these past couple of weeks.
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