Tokyo-based Showa Denko, which supplies essential chip fabrication materials to the likes of Taiwan Semiconductor Manufacturing Co. and Infineon Technologies AG, has been forced to drastically increase the cost it passes on to customers, Somemiya said. Because it’s a key supplier of the chemicals used early in the production chain by chipmakers and other manufacturers like Toyota Motor Corp., its price hikes could potentially squeeze margins or pressure customers to follow suit.
“A big theme this year common to all the players in the materials industry is how much cost burden we’d be able to convince customers to share with us,” Somemiya said. “The current market moves require us to ask twice the amount we had previously calculated.”
TSMC Stock Drops 1.56% in Premarket Trading.
