Taiwan Semiconductor Manufacturing Company (TSMC) has slashed its prices on 28nm and 20nm process technologies by 5-10% in order to secure orders from major clients including Qualcomm and MediaTek, according to industry sources.

The price cuts are also aimed at boosting TSMC's capacity utilization rates of 28nm and 20nm lines to more than 80%, the sources noted.

In response, TSMC declined to comment.

Decelerating smartphone demand has discouraged chip providers from placing orders with their foundry partners since the second quarter, the sources said. Foundries like United Microelectronics (UMC) and Globalfoundries have seen their 28nm customers cut orders particularly for baseband chips, the sources indicated.

Also facing a cutback of orders from its key mobile chip clients, TSMC has lowered its wafer quotes for 28nm and 20nm process technologies as much as 10%, the sources suggested.

TSMC's 28nm and 20nm process utilization rates already fell to as low as 70% and 60%, respectively, in the second quarter, the sources observed. By offering discounts, the foundry expects to regain orders and improve the process utilization rates to more than 80%, the sources said.