In early 2026, the electronic components industry is experiencing a significant wave of price increases. Numerous manufacturers across various sectors have issued price adjustment notices, affecting areas from memory and passive components to wafer fabrication, packaging, and testing .

This wave of price hikes has impacted almost all core electronic component categories, including passive components, memory chips, CPUs, and wafer fabrication. Leading manufacturers such as Yageo, Fenghua Advanced Technology, Murata, and Samsung Electro-Mechanics have successively raised their product prices, with some increases reaching up to 30% .

01 Dual Drivers of the Price Surge: Cost Push and Demand Pull

Two primary factors are driving this price surge: the sharp rise in prices for key metal raw materials and demand explosion fueled by AI.

The prices of key metals like gold, silver, and copper saw significant increases in 2025, with silver prices rising over 150% and copper nearly 40%, and are expected to remain high throughout 2026 . Silver, a crucial material for thick-film resistors and electrodes, reached a 45-year high, briefly exceeding $92 per ounce .

On the demand side, AI servers, new energy vehicles, and high-end industrial applications are the three core drivers. Unlike previous cycles dominated by consumer electronics, the current demand, especially from AI, places a higher premium on component performance and reliability, making it less price-sensitive .

A single high-performance AI server can require up to 30,000 MLCCs, more than ten times the number in a standard server. Similarly, a new energy vehicle with advanced autonomous driving capabilities can use over 10,000 MLCCs, with some models reaching 20,000 .

02 Structural Inflation: A Tale of Two Markets

This round of price increases is notably structural. There's a stark contrast between the super-hot demand in AI-related sectors and the more subdued or even pressured demand in areas like consumer electronics and certain segments of automotive electronics .

Memory chips are among the categories with the most substantial price hikes. TrendForce anticipates contract prices for traditional DRAM to rise 55%-60% and NAND Flash by 33%-38% in Q1 2026. This shortage cycle is expected to persist into the first half of 2027 .

In the passive components sector, core categories like MLCCs, resistors, inductors, and tantalum capacitors have seen collective price increases. Fenghua Advanced Technology raised prices for inductor beads by 5-25% and thick-film circuit products by 15-30% .

The wafer fabrication segment is also under pricing pressure. SMIC increased prices for its 8-inch BCD process by about 10% for some customers in December 2025. Strong demand for power management chips from AI servers is consuming significant 8-inch BCD process capacity, leading to tight supply in mature process nodes .

03 Ripple Effects on the Supply Chain: Winners and Losers

The price surge is having a differentiated impact across the electronics supply chain .

Upstream raw material suppliers and leading component manufacturers are clear beneficiaries. Major players can not only pass on cost increases but also leverage strong demand growth in high-end sectors to expand their market share. Small and medium-sized manufacturers focused on the low-to-mid-range market face greater pressure, with their profit margins being squeezed further .

Downstream consumer electronics brands are being forced to adjust strategies to cope with rising costs. PC and smartphone brands are employing a combination of tactics, including selective price increases for premium models, configuration adjustments, and sharing cost pressures with their supply chain partners .

There are indications that memory specifications for high-end and mid-range devices might consolidate towards the lower end of market standards, with upgrade cycles slowing down noticeably .

04 Reshaping the Competitive Landscape: Accelerated Localization and Technology-Driven Transformation

This pricing cycle is reshaping the industry's competitive dynamics. Domestic electronic component companies are leveraging this opportunity to enter high-end supply chains, achieving breakthroughs in material formulations, process precision, and reliability validation .

In passive components, companies like Sanhuan Group have seen their automotive-grade MLCCs certified and their share increase within the supply chains of automakers like BYD and Nio. Fenghua Advanced Technology's mass production of ultra-miniature capacitors has broken the monopoly of Japanese and Korean firms .

The dimensions of competition are expanding beyond mere technology and cost to encompass supply chain resilience, ecosystem completeness, and policy adaptability. In the future, China's electronic components industry is expected to form a landscape where "IDMs dominate the high-end market, and Foundries cover the mid-to-low-end market" .

Looking ahead, the trend of price increases in the electronic components industry is likely to continue in the coming year. The memory chip shortage cycle could last until the first half of 2027 . Segments like CCL and BT substrates are expected to see peak price increases in the first half of 2026 .

The industry's competitive landscape will also undergo profound changes. Domestic companies with strong technical expertise and resilient supply chains are poised to make breakthroughs in the high-end market, potentially leading to a reshuffling of the global electronic components market .

For industry participants, the key to navigating this wave of opportunity will lie in their ability to quickly access cutting-edge market and technical information, accurately identify and partner with key ecosystem players, and effectively demonstrate their core value proposition .