Phone Prices Will Drop: Chip Shortage Decreases!

The production of chipsets, which is one of the main parts of phone prices and many other technological products, has not been able to keep up with supply and demand for a while due to shortages. The chip shortage has greatly affected the production of cars as well as mobile products. Fortunately, there is good news.

With the outbreak of the COVID-19 epidemic, sales of technology products increased, indirectly increasing the need for parts. TSMC, one of the largest chip manufacturers, is based in Taiwan, and the drought in the region in 2021 has dealt a severe blow to chip production. Chip production uses a lot of water to cool industrial equipment. In addition, chip stocks have been struggling for some time due to political tensions between the U.S. and China.

Chip shortage may end: Chipset prices are expected to drop

Analysts state that the shortage of semiconductor chip production will decrease from 2023. According to the latest report of ANZ economic research team, the annual chip production capacity is estimated to increase by 9-16% in 2022. The increase in production capacity compared with 2021 has greatly relieved the car and mobile device industries. It is estimated that the growth rate of chip production capacity in 2023 will decrease to 4-8%. With the reduction of chip shortage, chipset prices will also decrease and will be reflected in the prices of mobile products.

The chip crisis has also hit the computer hardware industry hard. Graphics card manufacturers have been unable to manufacture graphics cards efficiently for a long time. Mining and the current chip shortage have caused graphics card prices to a rapid increase. In recent months, GPU prices have dropped again as the chip shortage subsided.

Xiaomi is one of Qualcomm’s largest partners, and Qualcomm’s chipsets are largely manufactured by TSMC. It is not known whether the drop in chipset prices as the chip shortage eases will result in Xiaomi models becoming cheaper.

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