Malaysian electronics firms central to the supply of basic chips that drive the world's cars, smartphones and home devices say big-name customers are beating on their doors to lock in take-or-pay, longer-term deals — and happy to pay more if need be.
Manufacturers are rushing to replenish chip stocks depleted during coronavirus pandemic factory curbs — not least automakers who earlier cancelled orders expecting poor demand. That chip shortage has slammed their output, and still dislocates supply chains, just as consumer demand ramps up along with a global easing of COVID-19 restrictions in everyday life.
At factories in Malaysia, operators like chip packaging firm Unisem say that drive is leading buyers that sell chips on to auto and electronics manufacturers to become willing to sign up for big price hikes, some even asking for as many assembled chips as plants can produce — whatever the cost.