[News] Samsung Labor May Strike from May 21, Potentially Lifting DDIC and PMIC Prices Amid Tight Mature-Node Supply

Samsung strike risks are rising, adding uncertainty to the semiconductor supply chain. JoongAng Ilbo notes that the labor union plans to carry out an 18-day general strike starting on May 21, with a rally scheduled for April 23. According to Commercial Times, sources say that if the strike begins, disruptions could extend into the third quarter. Institutional investors add that DDIC and PMIC supply would be among the first to be affected, potentially pushing up prices and extending lead times.

Supply chain sources cited by Commercial Times further indicate that if a strike does occur, supply of memory, display driver ICs (DDIC), and PMICs would be disrupted, tightening already constrained mature-node capacity. In response, the supply chain has begun preparing by building inventory and diversifying risk.

Commercial Times notes that mature-node capacity has already been under pressure this year. As the report adds, TSMC is planning to shut down some 8-inch fabs, has stopped taking new orders for 12-inch 90nm, and is gradually scaling back 65nm and 40nm capacity. Samsung, for its part, has also been optimizing capacity at its 8-inch fabs previously used for CMOS image sensors and display driver IC production.

In addition, institutional investors cited by Commercial Times say rising power consumption in AI servers is driving a notable increase in demand for PMICs and MOSFETs. The report also notes that utilization rates at China’s foundries have remained at high levels since late last year, with capacity prioritized for PMIC customers.

Strike Impact and Core Labor Dispute

The potential strike could result in significant losses. JoongAng Ilbo reports that Samsung Electronics’ labor union estimates the company could incur damages of between 5 trillion and 10 trillion won if a strike occurs.

As highlighted by Chosun Ilbo, the supra enterprise union, the dominant labor group at Samsung Electronics, has around 70% of its members drawn from Samsung’s Semiconductor Division DS. Against this backdrop, the union is actively pushing for a strike within the DS division, which could significantly impact the company, since even a short disruption to semiconductor production lines could result in considerable losses.

As for the core dispute, Chosun Ilbo notes that the main point of contention between Samsung Electronics management and labor is the removal of the cap on performance bonuses. Currently, the company limits OPI (performance bonuses) to 50% of annual salary, but the union argues that this cap should be eliminated. However, as Edaily notes, Samsung Electronics said that if the union’s proposal were applied to the 2025 performance-based pay structure, the payout ratio for employees in the System LSI and Foundry divisions, currently set at 47% of annual salary, would drop sharply to just 11%.

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(Photo credit: Samsung)