Group 1 - The semiconductor industry is expected to experience a new wave of price increases, particularly in the mature process wafer foundries such as UMC, World Advanced, and Powerchip, with price hikes potentially reaching up to 10% or more starting from April 2026 [1] - UMC has not confirmed the rumors of price increases but mentioned that the current pricing environment is more favorable than before [1] - World Advanced plans to adjust its foundry prices starting from April 2026, although the specific increase has not been disclosed [1] - Powerchip has confirmed that it has already begun to raise prices this season, focusing on product lines with lower gross margins [1] Group 2 - Major customers in the mature process segment, particularly IC design firms led by driver ICs, are also planning to increase prices due to rising costs [2]

Core Viewpoint - The article discusses the increasing pressure on wafer foundries, particularly UMC and World Advanced, as they negotiate pricing for 2026 amid rising costs and competitive pressures from mainland China and Southeast Asia [2][5][6]. Group 1: Pricing Strategies - UMC has initiated negotiations by requesting upstream suppliers to propose at least a 15% price reduction starting in 2026 to mitigate rising costs and pricing pressures [2]. - The 15% cost reduction request will affect various supply chain components, including chemicals, specialty gases, substrate materials, consumables, and maintenance services [2]. - The strategy aims to stabilize average selling prices (ASP) and cash flow by negotiating better terms with upstream suppliers before addressing downstream customers [2][3]. Group 2: Market Dynamics - IC design clients are adopting a conservative outlook for 2026, preferring flexible pricing and avoiding long-term contracts, which has led to a passive bargaining position for foundries and reduced order visibility [2][3]. - The competitive landscape has shifted, with increased production capacity in mainland China and Southeast Asia, leading to ongoing pricing pressures and the need for Taiwanese foundries to enhance their pricing strategies and customer relationships [5][6]. Group 3: Future Outlook - The next two years are expected to see a peak in global supply for mature nodes (28nm and above), with price competition becoming a norm, necessitating Taiwanese foundries to leverage technical services and customer loyalty to maintain market share and profitability [6][7]. - The International Semiconductor Industry Association (SEMI) projects a 15% increase in mainland China's chip manufacturing capacity by 2024, further intensifying competition for Taiwanese foundries [6]. - The article emphasizes that maintaining price stability and customer relationships will be critical for UMC and World Advanced during the economic adjustment period [3][7].