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TSMC would have auctioned its excess production with an extra cost of up to 20 percent

Industry rumors indicate that TSMC would have carried out an auction of its excess production capacity.

With a global shortage of silicon, TSMC would have sold the unallocated inventory to the highest bidder, and it is indicated that with this move the company would have applied an extra cost to its wafer production that is situated between 15 and 20 percent, although it is unknown who was the winner of the bid, but it is clear that this extra cost will be applied directly to your customers.

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This news should not catch us by surprise, and it is that at the end of 2020 we indicated that, for example, TSMC was going to cut wafer allocation to AMD. It is logical that if this movement finally took place, it also affected more companies, so it is understood that TSMC sought to adjust supply to demand, so that when the need tightens, higher payments can be demanded, since many companies will prefer pay this extra cost to run out of silicon.

To this is also added the stock that has been released and that he was not pre-assigned to any company. For example, Apple is focused on 5nm and it is already reserving the entire first wave of 3nm wafers from TSMC, so it is clear that it will have reduced its demand for 7nm wafers that can now be sold to the highest bidder.

via: TechPowerUp