The looming threat of Trump's tariffs is causing a ripple effect through the tech industry. TSMC, a major chip manufacturer, is planning to increase prices by up to 15% to offset potential losses due to tariffs. This will likely lead to higher prices for consumers on goods that utilize TSMC chips, including smartphones, computers, and more.
President Trump has repeatedly vowed to impose tariffs on various countries, and he's making good on his promise. These tariffs have sent multiple industries into a frenzy, including the semiconductor industry. TSMC , a major chip manufacturer, is reportedly considering raising costs by up to 15 percent, a significant jump from the originally proposed increase of five percent. These price hikes are intended to protect TSMC from incurring major losses due to the tariffs.
However, these increases in cost are likely to have ripple effects throughout the consumer market. Goods that utilize chips sourced from TSMC will probably see their advertised price tags replaced with ones that are less friendly to your wallet. Most brands will likely not be comfortable with a sudden decrease in profit and will likely try to pass the increased costs onto the consumer.This situation is particularly concerning for Samsung, which relies heavily on TSMC for its flagship smartphones, such as the upcoming Galaxy S24 series. If Samsung hasn't perfected its own Exynos chips by then and intends to stick with Snapdragon, it will have to grapple with these tariff-related cost increases. This could result in the next Galaxy phones being significantly more expensive or featuring cheaper displays and cameras.There are, however, a few ways these cost increases could be avoided, though they will take some time to be implemented. TSMC is likely to shift a considerable amount of chip production to the U.S. to circumvent the tariffs. Several plants are currently under construction that will produce chipsets within the country. Another avenue to avoid these tariffs is through negotiation. For example, Apple might be exempted from these tariffs, similar to what happened during Trump's first term. If CEO Tim Cook can convince President Trump to spare the company, the iPhone would gain a significant cost advantage over its rivals. TSMC is still assessing the impact of Trump's tariffs on its business model but it's highly probable that they will proceed with these price hikes, and ultimately, the end consumer will bear the brunt
TSMC Tariffs Trump Semiconductor Industry Consumer Prices
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