Huawei's Xu Zhijun talks about chip price increases: will lead to price increases for all consumer electronics products

The global chip shortage is getting worse and worse, and is causing far-reaching impacts. Recently, Huawei's rotating chairman Xu Zhijun also talked about this at the Huawei Global Analyst Conference. He said that if there is no global semiconductor industry chain cooperation in the future, semiconductor prices will rise by 35%-65% overall. Now the price of chip foundry is already rising, and then the price of the chip itself will rise, which will lead to price increases for all consumer electronics products. In the next few years, price increases are foreseeable.

Xu Zhijun pointed out that the US sanctions on Huawei and other companies are evolving into a global, industry-wide supply shortage problem, and it is unknown whether it will trigger a new global economic crisis in the future. He stressed that the fundamental answer to returning the entire semiconductor industry to normal business order is to rebuild global trust and restore cooperation in the global semiconductor industry chain.

It is reported that the design and manufacturing process of semiconductor products is very complex, requiring very high R&D investment and capital expenditure. In this context, a highly specialized global industrial chain has been formed, with different regions playing different roles in the industrial chain based on their own advantages, prompting the semiconductor industry to continuously achieve technological innovation, reduce product prices, and benefit global companies and consumers.

However, the US sanctions on Huawei have destroyed the trust system of the global semiconductor industry chain, forcing more countries to consider the security of the semiconductor supply chain. If the globalized industry chain is de-globalized, the price of semiconductor products will need to rise by 35%-65% overall to meet the corresponding costs, which will lead to an increase in the cost of consumer electronic devices. In addition, the US sanctions on Huawei have caused panic stocking by global companies, making the supply of semiconductors even tighter and more scarce.