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Automotive IDMs raise prices

Automotive IC IDMs including Rohm Semiconductor will reportedly raise their prices to reflect rising raw material costs, according to industry sources.

On September 1, IT companies were reportedly notified via a letter signed by Raita Fujimura, chairman of Rohm's Shanghai subsidiary, that prices for new and old products would increase to reflect increasing raw material costs, said the sources.

The letter said prices for new orders received after October 1 and existing orders in shipments will increase by 10%, the sources said. It was also noted that the increase for some product lines would vary.

Taiwanese power semiconductor companies said the price increase from Japanese IDMs has been slower compared to other international manufacturers. They also pointed out that the delivery time for MOSFETs, power modules, and silicon carbide (SiC) third-generation semiconductors has not shortened much.

Sources said there are still concerns about uneven materials supply for automotive chips. Inventory pressure on components from long supply chains is building up, but there is still tight supply of power semiconductors and microcontroller units (MCU) continues, the sources said. Systems manufacturers are also looking for alternatives since the price of automotive chips, including power components, is expected to continue rising in 2023.

According to the sources, Taiwan-based power component makers including Taiwan Semiconductor (TSC), Pan Jit International, Eris Technology, Advanced Power Electronics (APEC), Sinopower Semiconductor, Excelliance MOS (EMC), Niko Semiconductor, Force Mos, and uPI Semiconductor have seen demand in the consumer electronics and IT sectors fall.

Taiwanese backend packaging and testing vendors, such as Gem Services, have also admitted that visibility is not very clear. It pointed out that orders have decreased from Chinese and Taiwanese MOSFET makers, resulting in a rapid drop in utilization rates in the latter half of the third quarter.

The sources noted that demand for automotive and industrial control products, particularly power components, remains stable. Power component makers that started out making diodes, including Pan Jit, TSC, and Eris, have since expanded into automotive and industrial control products.

As the consumer electronics market undergoes inventory digestion, sources say it is the perfect time to implement other changes. For example, Pan Jit continues to push its silicon-based (Si-based) IGBTs and Eris is phasing out its less effective and less efficient equipment. Both are doing so to raise the profitability of new products and increase the threshold for competition.

Taiwanese companies pointed out that the delivery time for automotive IGBTs from major IDMs is still more than 50 weeks.