As wafer foundry quotes continue rising amid tight capacity, chip vendors are expected to dynamically hike their quotes to reflect increasing costs in the next quarters, according to sources from leading design houses.

TSMC has decided to hike its quotes for 12-inch foundry services in the second quarter of 2021, estimating that tight capacity for advanced process nodes will not ease until 2022 and capacity shortages at 6- and 8-inch fabs will not improve till 2023 at the earliest, which suggests foundry quotes will trend up in the coming quarters, the sources said.

Other foundries UMC, VIS and PSMC have all raised their quotes for both 8-inch and 12-inch fab quotes by 10-15%, and are poised to enforce further hikes before capacity constraints ease in 2022-2023, the sources continued.

Chip vendors will have no other choice but to pass part of the increased foundry costs to downstream clients, and they are expected to ramp up quotes quarter by quarter, adding new dynamic growth momentum to their revenues, the sources said.

As long as IC designers can obtain capacity support from foundry houses, their downstream clients can accept whatever reasonable price hikes, the sources believe, noting that delivery lead times from international chip vendors have extended to 30-40 weeks or even to 50.

By: DocMemory
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