Chip Industry – Infineon Announces Higher Prices – Economy

The Dax Infineon group commits its customers to higher prices for semiconductors. “We are going to raise the prices or have already raised them,” said Infineon boss Reinhard Ploss of Wirtschaftswoche. He justified this by the increase in production costs. The semiconductor manufacturer faces higher costs because they do not manufacture all the chips themselves. “Of course we have to pass those costs on,” Ploss said. How strong will the price premium be it left open.

The boss of Infineon sees low chip prices as one of the reasons for the shortage of important components, which is currently causing problems for the auto industry in particular. For some components, the industry has become accustomed to buying them at very low prices, he said. “If chips are trading at very low prices, then there is very little incentive to create more capacity.” Due to the semiconductor shortage in many places, the auto industry cannot increase production as expected after the summer break. Audi, for example, has recorded short-time working for thousands of employees, and Volkswagen will also have to cut production in Wolfsburg after the summer holidays. And even with industry leader Toyota, production in September remains 40 percent behind target. A quick fix is ​​not in sight: The Infineon boss assumes the chip crisis will last until 2022.

The Munich semiconductor maker isn’t the only company to raise prices: According to the Federal Statistical Office, producer prices in Germany rose more sharply in July than they did in 46 years. 88% of companies struggle with higher purchase prices, as the German Chamber of Commerce and Industry (DIHK) found in its latest survey of nearly 3,000 companies. As a result, two-thirds feel compelled to pass the increased costs on to their customers.

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