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25/09/2021

Global chip shortage could make Apple products even more expensive

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Future Apple products, such as the iPhone 13, may become more expensive due to chip shortages and rising supplier prices. According to Nikkei Asia sources, Apple’s main chip supplier TSMC is raising its fabrication prices due to the ongoing global semiconductor job shortage. That means Apple may have to pay more for chip production and pass the costs on to customers. 

The chip shortage has significantly impacted both the production jobs and prices of most flagship tech products over the last two years, making it nearly impossible to purchase devices such as the PS5, Xbox Series X, and various PC components (like the Nvidia GeForce RTX 3080). As a result, many affected products have been purchased by chip dealers to resell them at twice or even three times their original market value. While we had hoped that this would have little to no impact on Apple’s upcoming devices, it now appears to be unavoidable. 

According to a Nikkei source, the price changes will be “noticeable,” affecting Apple’s most popular devices such as iPhones and MacBooks. Apple’s products are already expensive, owing to the high-quality components and materials that go into making them. TSCM, Cupertino’s A-series chip supplier, for example, produces components that are on average 20% more expensive than those of its competitors. 

Now that the chipmaker’s competitors have begun raising prices, it is expected that TSCM will follow suit to maintain its premium market position. And because there is a good chance that Apple will have to pay more to produce its products, the price of Apple devices may rise as a result; after all, the Cupertino company does not make a profit on its devices. 

The source also stated that the manufacturing price increase is TSMC’s move to weed out the clients trying to order more chips than necessary to ensure they get a spot on the production line. “We are all in a great shock and all of our account managers need to speak to our customers to see if we can renegotiate some of the contracts,” a chip executive reportedly told Nikkei. “We haven’t seen TSMC introduce such a broad rate increase in over a decade.” 

While there are no details on whether or not this change will affect Apple customers, the source speculated that the tech giant might raise the retail prices of its high-end models around next year to offset the impact on its mid-range and less expensive products. 

The iPhone 13 is expected to be unveiled at an upcoming Apple event in the coming days. So, it won’t be long before we see if Apple raises the price of its next iPhone due to this tricky chip situation. 

Source: Tom’s Guide 

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