TSMC to charge premium for making chips outside of Taiwan, including its US fabs

Back when I was in semiconductors in the US (worked for a prominent wafer fab equipment vendor), there was a push to improve efficiency by logging all your hours, describing the projects you were doing, and giving them subjective importance scores. My manager was like- "Don't waste your time on that, its worthless. Everyone ends up reporting they are working 110% on the most important projects if you ask them."

Anyways the fabs in the US always had lower employee efficiency because the Taiwanese and Korean fabs would always show their employees managing to get installs or maintenance done in record time without any using any overtime. What was happening was simple wage theft: employees were expected to complete unpaid overtime. That was the culture, which rolled downhill from the TSMC and Samsung fab managers: your teams either work unpaid overtime or they find another job.

Occasionally US based personnel would go over to help if there was a big install effort or something. The local account teams didn't like doing this because the US guys wouldn't work unpaid. Thus the install hours would start creeping up and it made them look bad.

Doesn't seem malicious given higher cost of living in, for example, Arizona vs Taiwan. Labor unions pushing for American labor are to be expected, and likely in line with usgov's stated goals for CHIPS act.

So whose going to pay the premium except military? Even then, would they have the demand to pack the fabs and keep it viable? Especially during next cycle of overcapcity. Are we going to have North American skus of graphics card that comes at premium? TW not going to be happy if commerical goods shift away from TW fabs that keep TWnese employed.

[dupe]

Discussion: https://news.ycombinator.com/item?id=40078065

This seems completely reasonable, from what is said in this interview.

"We all take two years to develop one generation, how come you guys can do it in one or one-and-a-half year?" And they asked if some of your customer transfer technology to you or what not? And I told him, "No," I told him that, "That's not true." I think he probably implied we steal technology from customer, the way he talk.

And I say, "I'll tell you why." I said that, "When we develop one node, basically you have some learning cycles. First, you do some simulation. And you have some idea, then you run wafers to prove that. So, you run a group of wafers according to simulation and you have some splits. The wafer runs through the fab, they come out and you measure them, you analyze them, and you try to improve and you run this again. This again, you run. So, this is learning cycle." At that time, "It takes about six learning cycle , roughly, to complete one generation." Of course, you had some short loops and not just one. I said that, "My R&D wafer in the fab run much faster than yours, because my R&D engineer works three shifts and you only work one shift. So, your R&D wafer move eight hours a day, my work/move 24-hours a day. So, my wafers go three times faster, even if you are twice smarter than me, I still beat you up." <laughter> . . .

And what interesting at that time, the board member from Motorola, I just remember, his name was Bill Walker. . . Bill Walker. He's a big, big guy. Later on, I found he used to be a Marine. I knew that later. . . Because he was one of my very large customers, I usually visit him once a year.

I went over with our sales manager and the two of us usually went to his office. And he had one of his Supply Chain Manager - four of us sit-down. Usually Bill would give us a lecture telling us what we did wrong and how bad we behaved. I took notes. The meeting lasts an hour. Next time I visit him, they took me to a different room. I found it a little bit different. When they opened the door, there were about 20 people around the table. He was in charge of R&D and the manufacturing for Motorola Semiconductor Worldwide. He said, "These are my R&D and the fab managers in the entire world. I got them together. I want you to tell the same story to them." <laughter> So, that was what I always told them but they didn’t listen.

https://www.computerhistory.org/collections/catalog/10279267...

Complying with OSHA ain’t cheap folks, and lol if you think they will absorb those costs.

Now you’re incentivized to continue sending your business overseas where taxes, if any, and jobs, continue to foster the growth of another economy, while their fab locations here give them a US legal presence, and all the advantages that having a physical presence affords.

You can also choose to willingly pay more to have your roof replaced if you don’t want to run a free advertisement sign for the roofing company.

Nobody is going to choose to spend more money for the same exact outcome, especially not corporations beholden to shareholders, whose bonus checks are based on profits.

Will these fabs see use? Sure, but I bet only when other fabs are booked or some other fulfillment or capacity issue prevents the Taiwan fabs from being used and the extra cost is the lesser of two evils vs not producing anything at all