2026 Crisis Worsens, Many Factories Predicted to Shut Down

Jakarta, CNBC Indonesia - Memory chip prices are soaring wildly, impacting sales of consumer electronic devices such as mobile phones, routers, and laptops. CNBC Indonesia’s observations last week revealed that traders at ITC Kuningan are already complaining about declining sales due to the price surge.

In an interview, the Taiwanese semiconductor company Phison warned that the entire production line is at risk of closure due to the ongoing memory chip crisis.

Phison’s CEO, Pua Khein-Seng, stated that demand from the AI industry for memory chips has absorbed nearly the entire global production capacity. As a result, production of conventional chips for electronic devices is being sidelined because high-capacity chips (HBM) for AI are deemed more profitable.

At the same time, demand for chips in both AI and electronic devices is growing significantly. This is driving prices to their highest levels in history.

If this situation continues, many manufacturers may have to halt their product lines or even file for bankruptcy, quoted from TechBook on Monday (13/4/2026).

Pua’s statement was made in an interview on a Taiwanese-language YouTube channel from Taiwan’s Era Television station. A netizen summarised the interview via a post on X.

“Many electronics manufacturers will go bankrupt or abandon product lines by the end of 2026 due to memory shortages. Mobile phones are heavily affected, with production potentially dropping by 200-250 million units. PC and TV manufacturers are also likely to face production declines,” Pua said in the interview summarised by the netizen on X.

The AI industry is playing a central role in this. Nvidia’s AI-optimised computing platform, Vera Rubin, requires more than 20 terabytes of SSD storage per unit. If the company achieves sales targets of tens of millions of units, this alone could consume around 20% of global memory production.

Memory manufacturers are now demanding upfront payments for up to three years to secure supplies. Pua estimates that this crisis will last until 2030 or longer. A very pessimistic forecast predicts a duration of up to 10 years.

This scarcity primarily affects manufacturers of affordable electronics. This includes streaming devices like Amazon’s Fire TV Stick, Roku, or generic products, Wi-Fi routers, smart home devices, cheap surveillance cameras, smart plugs, and robot vacuum cleaners. Affordable smartphones and smart TVs could also see massive production drops.

Analysts estimate that smartphone costs will rise by 6-8%. For consumers, this means higher prices, fewer options, and longer product cycles.