TSMC Faces Higher Costs for Overseas Chip Factories, May Lead to Increased Prices for Outsourced Manufacturing

According to a report by Tom's Hardware, the leading US technology website, Taiwan Semiconductor Manufacturing Company (TSMC) faces higher costs when building chip factories overseas compared to domestically. In order to maintain profit margins, prices for outsourced manufacturing may need to be increased. However, the cost of producing US-made chips may be 30% higher than those produced in Taiwan, raising questions about whether US customers are willing to bear the additional cost. It is rumored that the cost of outsourcing to TSMC's US factory may be 20-30% higher than that of the Taiwan factory, while the price difference for chips produced in the Kumamoto factory in Japan may be in the range of 10-15%.

It is important to note that TSMC has responded to these rumors by declining to comment on pricing issues and market rumors. TSMC previously stated at a press conference that the overall construction costs of US factories are generally four to five times higher than those in Taiwan. However, TSMC will ensure profitability overseas and believes that a long-term gross profit margin of over 53% is achievable even with increased capacity outside of Taiwan.

TSMC emphasized that although the initial costs of building chip factories overseas may be higher than those in Taiwan, the company aims to manage and minimize cost differences. TSMC's pricing strategy will remain strategic and reflect the value of its services, including the flexibility and value of being present in different regions. Additionally, TSMC will continue to leverage its advantages in large-scale production, economies of scale, and leading manufacturing technology to continuously reduce costs. The company will also continue to closely cooperate with governments of various countries to obtain support.

For electronic components distributors, this information is relevant as it indicates that TSMC is committed to maintaining profitability despite the challenges of building factories overseas. It is important to keep an eye on pricing changes and any updates on TSMC's strategy in response to these challenges.