TSMC to Build Advanced Semiconductor Factory in Arizona
wsj.com
wsj.com
https://www.tsmc.com/tsmcdotcom/PRListingNewsAction.do?actio...
It is one of their biggest insurance against mainland aggression. Any conflict with Taiwan is suicidal for the mainland economically. Plus, add the fact that 3/4 of China's own light industry is within 1000km radius of Taiwan.
TSMC has already bough land and started construction for its 5nm fab, and laid first stone for 3nm fabs in Taiwan.
Stopping 3nm fab construction now is completely out of the question unless they are ready to throw out few billion dollars cash out of the window, at the time when they took biggest debt obligations in their history.
Only 2nm node is left on the roadmap, but there are big, big doubts of it materialising any time soon. We are talking about at least 8-10 years.
With all my knowledge of the industry, such deliberations never result in decisions like "Hey, lets set aside 20-30 billion USD to lay still for 10 years, and hope for everything happen according to plan."
Semiconductor fab companies are extremely, extremely risk averse, and snap judgements are completely uncharacteristic of the industry.
They don't do anything without having top tier economists, and finance people have a go at the task for years on end. Financial planning of fab construction takes years.
What is much more likely is them taking over a smaller fab in US, or building a limited scale project to make specialty chips for rad-hard, or US military hardware companies on US soil. This is what I myself been hearing for much longer than Trump been in office.
Intel itself has to haul all consumables for their US fabs in Arizona from Asia.
So, add few more billions for the uncertainty on the supply chain side.
Plus, having a 2-3 year project deadline looks to me as feasible, but still very tight. TSMC's 5nm fab in Taiwan has effectively took 4 years given that they still in the final stages of setting up its internals. In US, they will have to do all of that without the massive support of Taiwanese industry, and no local expertise.
Also, by completing a 5nm project 3-4 years from now, who they will be selling the capacity to, when biggest cash cows will move to 3nm, and there will be nobody to take their place for existing 5nm capacity? The cost of tapeout on 14nm is already so extreme that leaves only around 30 companies globally in the game, it will be much worse for 5nm.
Now, the biggest showstopper — TSMC is a public company with a lot of pension fund, and sovereign fund type investors. How they are going to make them swallow that? Them saying that out of the blue will be a bombshell.
Lastly, Taiwanese government has long subjected its semiconductor industry to zealous supervision, and policy guidance. Such move will have to pass by the regulators, which Taiwan has many.
So, without US government putting at least $20B cash, and big guarantees on the table, the project seems to be in the same gimmick rank as Foxconn's Wisconsin plant.
Commercially, it makes not much sense to me unless something really surreal is happening on the political, or financial side of the matter.
https://en.wikipedia.org/wiki/List_of_Intel_manufacturing_si...
NXP has Freescale’s old fabs as well. I think generally speaking, AZ is well represented in terms of fab expertise.
Barely any stock market reaction this morning on the Taiwan exchange open (ticker: 2330:TT).
US is brining supply-chain by hook or crook.
Taiwan needs Americas protection and no other country can be its security guarantor not even Japan. So US has leverage.
I would be surprised if TSMC does not open multiple facilities in US.
Tesla factory in Shanghai - if there is a war, all bets are off. CCP will raid the factory within the next 20 mins and employ military rule in the factory in about an hour's notice.
Physical assets are in some ways the ultimate thing to own. Even services that run on data centers which are physical things. Semiconductors are physical objects that your Dropbox runs on.
I just wish American president was someone like the Taiwanese president. She is a strong, powerful and smart lady.
I don't doubt that the Taiwanese president is smart, which is why I doubt this story.
No, the opposite. Real trade enables balanced long-term interdependency, growth and innovation, unlike "free" trade focused on extraction and asymmetrical flows. The most valuable assets brought to the table by Taiwan and the USA are culture and these are complementary in the long term.
Taiwan needs all the leverage it can get, and giving the US the gift of no longer needing it would be the dumbest thing TSMC could do in the long and short term.
A real partnership can create more leverage, not less, instead of holding one card until it is overtaken by events.
The US had no issues using the NSA to spy on German IP and even bug the cellphone of Angela Merkel. And well, given that no consequences ever materialized, it won't seem like they'd need to stop at any time.
So given that, thinking that the US has "strong laws" is a tad naive. You know, since literally the opposite already happened.
5th.
> Forced labor would violate the 13th Amendment.
Not if the laborers were convicts, but, yes, generally.
Of course the takings clause could also be satisfied by compensating TSMC, which perhaps due to sanctions or congressional action could be tied up indefinitely.
I don't think so. In 10 years, there will be no Trump in the office, and I doubt than even US based companies are ready to stake so much money on US government money continuing to come in 10 years term.
> Taiwan needs Americas protection and no other country
Their biggest defence against China is their mutual economic annihilation, along with most of world's light industry.
Remember, it was USA who made them loose their UN seat, and sabotaged their nuclear weapons program to keep them dependent, and let China into the WTO. Since at least Jiang Jingguo, Taiwan has been rather ambivalent with USA, and are wary of being set up
Trump is not the first to raise the point on this exact matter, in fact that was going back and forth at least since Bush Jr as I know.
Lastly, the biggest, and most obvious argument about your sentiment is that if American political establishment (with Trump, or without him) were truly serious about committing to confrontation with China, they should've started with barring US companies making business with Chinese multinationals, or at least obvious state companies.
Without seeing that first, you can be assured that US will not run into collision with China, or the politically connected big money in US would be first to run.
Europe, Korea, Japan, India and Australia are planning to recede from China's dependence on manufacturing.
This is an amazing time to be alive, I encourage people to look into manufacturing disciplines. As Elon put it (agree or disagree with him, but he is right about this) - "Someone's gotta build stuff. If you're not doing it, someone else is." Physical things don't just pop out of thin air. Every single thing except your body and natural substances are manmade. Someone decided how its gonna be built and how it will come into existence.
I believe that we need to reframe the debate around manufacturing from one about jobs to one about national security.
This mentally frees us to fully invest in manufacturing automation, which will neutralize any labor cost advantages China and other countries may have.
American's dream for a open and democratic China is long dead.
There already is an open and democratic China across the Taiwan straight. And the USA has a looong history of rather ambivalent relationship with it, starting from the Chinese civil war (to the surprise of many, US has sided with Mao for quite a number of times)
For long, US policy was to purposefully keep the Republic of China weak, vulnerable, and dependent.
Were the US even 1% genuine in their commitment to seeing democratic China, they would not be consistently setting up Taiwan to be undermined politically.
This is now precisely what is changing.
Doesn't look like US politicians today are willing to throw Eastern Europe under the bus to flip Russia against the PRC like they threw Taiwan under the bus though.
The US manufacturing sector is 11.6% of GDP, so 2.33 trillion dollars PPP. In China, it accounts for 40% of the GDP, so more or less 10 trillion dollars of manufacturing output PPP (!). This is a manifold advantage.
The reason why this is to be done is because if you wanted to build say, a tank in the US vs China or Russia, you would need many more dollars for the exact same tank. So measuring manufacturing output must be done PPP.
China also doesn't require any naval transport from oil shortage. Indeed, it very conveniently has a major oil exporter to it's north. So unless you would wage war on the Russian and Chinese mainland, you have no hope of completely starving China of oil. You might reduce the amount of oil they have, but they have enough reserves to last until a tripling of Sino-Russian pipelines.
CFIUS actions have been reported in the tech news for the last 12 months, in multiple sectors.
The china strangely you may think object. It is like British is passing a law finally to give up USA and USA object. But china do. And they know once cut off the USA can recognise Taiwan, unlike in the past it is a bit of conflict. What is Taiwan - oh the whole china. Now what is Taiwan? An island ruled by an independent state from at least 1949 (or legally from 1911 one should say). It even has a us-Taiwan act link even after 1979s.
It is good timing to try this move. But before that ...And hence all civilian infra is moving out from china by their allies and USA may have to think about getting key assets duplicate from Taiwan.
No one Outside china want war. But you have to prepare for it and avoid a total disruption of you own country and life. Chip is strategic. And the skill set not just the tools.
Higher post same idea as my previous post. Taiwan need a deal as USA cannot be trusted in international conflict. It is ok for Korea and Japan perhaps, but would USA gave up Taiwan when the first USA soldier died. We are talking about a country that has nuclear bomb and the means to bomb USA mainland.
Some deal needed.
Remember Foxconn Wisconsin? https://www.theverge.com/2020/4/12/21217060/foxconn-wisconsi...
I don't quite understand what you mean by this, what is the context of US support for Boeing?
US air doctrine is that they will always buy air dominance, so Boeing will be funded for military programs. However, the US govt. historically has had the influence to tell military aircraft mfgs. what to prioritize, and what lines to drop.
An example is Northrop. They were told to drop the popular F-5 and F-20, and focus on the B-1 program. They were also told to merge with a competitor, but declined.
It's weird when you first study it, but the US Air Force wants zero risk missions into enemy skies.
So that's why they're ok with a handful of $200 million fighters and $2 billion bombers, if they're stealthy enough not to be seen.
(Stalin on the other hand is often attributed with saying, "Quantity has a quality of its own." I would argue a balance is needed between a perfect fighter, in the case of the F-22 with under 200 airframes mfg., and having 10,000 slightly less perfect ones, like the F-16.)
W: F-22 https://en.wikipedia.org/wiki/Lockheed_Martin_F-22_Raptor
Guess that is why Taiwan also would not want the asset out.
There have to be a political deal. If USA and Taiwan is competent.
(Coronavirus death toll now larger than Vietnam)
TSMC US-manufactured FPGAs could be a good compute platform for open-source hardware designs that can be rapidly iterated.
ERI: https://eri-summit.darpa.mil/what-is-eri
OpenCompute ODSA: https://146a55aca6f00848c565-a7635525d40ac1c70300198708936b4...
There is a secure foundry system for DoD use: https://semiengineering.com/a-crisis-in-dods-trusted-foundry...
> Toolchains and IP are not the issue . We're talking about actual manufacturing.
Of course. Let's say you're TSMC with limited capacity on your bleeding edge node, operating a price auction that drives up revenue against your fixed investment. Would you create another fab to compete with yourself, adding extra capacity, reducing price competition, and revenue?
Now let's say you can create a new fab that does not compete directly with the existing product line, e.g. because most of the capacity of the new fab will be occupied with new customers who could not previously make use of the Taiwan fab. Where would these customers come from? They can't only be the US customers who use the existing "secure foundry", as that would mean supply/competition problems for GlobalFoundries.
Any large supply increase in actual US fab manufacturing is going to require a large demand increase in actual US fabless semiconductor companies. Open toolchains and IP are a necessary, but not sufficient, step on the path to expanding the commercial US semiconductor industry, which would also benefit secure use cases.
The tectonic shift is that it has suddenly become a priority for the permanent, unelected (i.e. real) US government for a different set of reasons.
Just to provide some context into possible motivation behind some of the statements they are making.
What if the current administration don't last till 2021?
Or more likely, what if the word of the current administration don't last till 2021?
Some talk softer than others but the direction is baked in.
As a government with a consistent policy? I'll wait until 2021.
But there's certainly a school of thought that CMOS process scaling was the big engine of tech over the past few decades and there may be nothing that comes close to replacing it to anything like the same degree.
A good summary of what's going on: https://asia.nikkei.com/Opinion/Taiwan-s-semiconductor-indus...
she is pan-green. CCP does not like pan-green anything at all. they especially doesn't like her and favor the pan-blue candidate during the president race. CCP even went as far as bribing Taiwanese in China to go back and vote for pan-blue candidate. this story just break recently.
Taiwan needs U.S. security guarantees. she will let TSMC out of island if it mean it doesn't piss off Uncle Sam and US have been applying a lot of pressures on TSMC for making chip for China.
The US is more "business-friendly" than Europe, but nothing compared to China or Taiwan for people with the right connections.
Occasionally you'll see unscripted interviews between a US reporter and a visiting Chinese business leader.
The US reporter always asks if the visitor will be opening a local factory (because the US is so awesome!), and the visitor starts looking around wildly and demurs, since they're just here to park money.
Please don't use uppercase for emphasis. If you want to emphasize a word or phrase, put asterisks around it and it will get italicized.
I've worked in the industry and you can't even go inside the lobby of one of these buildings without having epoxy poured into all the USB ports of your various electronics. Security is best described as absolute in these facilities. Getting into the factory itself is yet another security check. You cannot bring any personal items into the clean room last I was told the rules.