Great news for the US. Great news for Apple, AMD, and Nvidia.
Not so good news for Taiwan. The fact that the whole tech world is dependent on chips produced in Hsinchu is a huge advantage for the safety of Taiwan. Moving the fabs and talent further away from the island will not benefit the people of Taiwan at all. TSMC with its global influence has been a huge factor for guaranteeing safety of the island and peace in the Taiwan strait. On the other hand, TSMC is a corporation like every other and does what's best for their business. Most likely it's a huge win for everyone holding their stock. Are we going to see fabs in Central/Eastern Europe next? I'd hope so.
By the time the fab comes online in 2024 (which seems optimistic), 4nm should be a half-step generation or so behind.
TSMC also has a dozen or so fabs in Asia, so it's not clear how the single plant in Arizona is going to meet capacity requirements or how often that plant will be retrofitted with newer equipment.
This plant and the federal subsidies backing it seem more like a way for defense contractors to domestically source relatively recent fab processes over the next couple decades rather than something intended solely for consumer products.
The fact that consumer facing companies are interested in using the fab when it comes online doesn't necessarily mean they'll still be using it 10 years from now unless TSMC keeps it up to date.
This isn't my field, but I'm not sure what's the excitement about an Arizona plant that will optimistically start production a year later with an older process.
There is still a lot of demand for the not-latest-generation, "long tail" fab processes. Much of the long tail manufacturing was (is?) what the chip shortage was about, rather than the current generation.
A good example is the automotive industry. It doesn't typically move quickly or frequently onto newer generation processes as that requires R&D time and other expenses. However, these have been some of the worst shortages, with auto manufacturers still impacted by lead times (although, this is starting to clearing up fwiu).
Targeting the current-best process, rather than the next generation, alleviates some compounding of risk that would be incurred by logistics concerns of turning up a new site and putting that new site on a process that they don't yet have full confidence in because it's not seen production yet.
Does "one generation before current" count as "long tail", though?
The chip shortage in products like cars has been for much simpler chips, AFAIK.
The article says Apple, AMD, and Nvidia are looking to source from the new plant. Aren't they canonical examples of companies that are always looking for the latest and greatest? Why would they be interested in an prev-gen chip?
Automotive industry is still using 90nm chips. It's not even the generation before the current one. They have long production runs and require stability, and they also prefer to use standardized parts across many production runs.
Defense also uses older chips. Don't ask what kind of chips are in Amraam missiles or the F-35 -- although the F-35 is getting a technology refresh now (after a 14 year production run).
Only in bleeding edge consumer devices does it make sense to keep changing chips. In other systems, production runs can last 20 years and the life of the asset can be 40 years or more, and you want the same spare parts available throughout the entire expected life of all assets produced. And then when you look at fixed assets, such as thermal power stations, then you are looking at even longer time horizons.
That's what I thought. If consumer products tend to use the bleeding edge, which will be the state-of-the-art chips produced in Taiwan, then I still don't get:
1. What's so exciting about a prev-gen fab possibly being completed in 2024?
2. Who will buy the chips produced by the 4nm Arizona fab, and why?
The only plausible answer offered for 1 in this thread has been that it's too difficult to jump straight into the bleeding edge, and this is the most the US can do to lay the foundation for an eventual catch-up with the state of the art in chip fabrication.
If mission critical applications (military, automotive, aerospace) are using older chips, and smartphones/computers are using the latest, then everything else is using chips between those two extremes... computer peripherals, office machines, toys, audio/video systems, communication equipment, lights, HVAC, anything rechargeable. The list is massive, you name an industry and they will probably be buying 4nm over the next couple decades.
Because overall the us chip production capacity and technical reach has been reducing over time. We need to establish and pull over a much larger amount of production so our strategic needs can be met inside the us. This helps us avoid problems like our key sources being cut off or destroyed with our allies like Taiwan and South Korea, or China does more and more production and technical leadership and decides to squeeze us.
Intel has sinking in at least technical leadership for a long time. It's obviously a priority a need for the us to on-shore more chip prod.
Lower end consumer electronics are fine with chips that aren't the absolute latest. The point isn't that they won't find buyers, but rather that they will earn less money building a fab in a location with much higher labor costs and producing chips that are a bit behind.
My guess is that the decision to build fabs in the U.S. was the result of geopolitical strong-arming by the U.S., but TSMC will still find buyers and that the fab will at least pay for itself.
Starting in 2022, the high-volume iPhone has been switched to the N-1 generation SoC, while the bleeding edge SoC is reserved for the lower volume iPhone Pro/Max.
Many companies (including NVidia and AMD) are adopting chiplet designs for which different parts of the chip can be manufactured on different process nodes. The most performance critical aspects of chips will be manufactured on 3 nm nodes, but most of the chip will be manufactured on 4-10 nm nodes. It's too expensive (in cost/wafer) to use 3 nm for everything.
> The article says Apple, AMD, and Nvidia are looking to source from the new plant. Aren't they canonical examples of companies that are always looking for the latest and greatest?
CPUs and GPUs get all the press, but there are dozens of other chips used in even the latest models that use older technology. For all we know Apple could be buying those chips for USB cables, or pencils.
You don't start at the cutting edge immediately. You start where it is better understood. Then you can still pay the enormous investments needed for getting to cutting edge and furthering it, if you want. Also, from an economic perspective, there is still plenty of demand in the market for non-cutting edge node sizes, i.e. in embedded the priority is more around the fact that the chip is not changed from a specific design that was made 4 years ago than having the latest and greatest.
From a strategic perspective, it is absolutely important that you have the capability to build chips in your country, of a reasonably modern node size. You need this for weapons manufacturing, for a working government apparatus (governments use computers now), for sending messages to your population. And if China bombs Taiwan, then this fab will become the cutting edge, instead of you having zero chip manufacturing capabilities.
> TSMC with its global influence has been a huge factor for guaranteeing safety of the island and peace in the Taiwan strait.
This narrative is echoed around the internet, but if you study the actual history of the Taiwan Strait Crises (which started before the semiconductor was invented), it never comes up in official discussion or analysis. See Kissinger, for example.
Cynically, this narrative was possibly promoted by the USG/Taiwan-lobby to put lipstick on what has always been a naked display of power politics. Washington wants its First Island Chain to contain China [1], and Beijing doesn't want Washington to have it.
> Cynically, this narrative was possibly promoted by the USG/Taiwan-lobby to put lipstick on what has always been a naked display of power politics.
I also suspect this narrative is at the very least supported if not conceived by Taiwan as propaganda. But we don't need to be cynical. What this narrative does is establish in the minds of Americans a shared interest in Taiwan and, arguably, even a shared identity. That's not intrinsically bad, malicious, nor even disingenuous on the part of the Taiwanese. Especially for a country as large and resource rich (in every meaning of the term) as the United States, all overseas interests and identities are built principally on fictions; some built very deliberately, but many which grew organically. IMO, the high technology dependency narrative fits comfortably between pure ideology (democratic solidarity!) and pure real politick, e.g. oil. Unlike the case with oil interests, the narrative speaks to a coevolution of our industrial and economic bases on equal terms in tandem with political ideology, and thus posits a shared future. And given how quickly and easily the narrative has spread, it has a strong organic character to it--even if Taiwanese political strategists planted the seeds, the soil was more than accommodating.
Such a crafted narrative to me seems more like an invitation than manipulation. (Either way, admittedly such characterizations are dependent on one's chosen perspective.) Nonetheless, it should be recognized for what it is; taken literally it leads to erroneous conclusions. If the U.S. aggressively defends Taiwan in an invasion attempt, it won't be because of TSMC and fears of a chip shortage; it'll be because the American public has become invested in the idea of a free and democratic Taiwan, and willing to believe and accept that the US's long-term self-interests are furthered by putting itself and its citizens in the way of considerable, even existential harm. The story of TSMC would just be one of many--albeit an important one--along the road which brought the nation to that state of mind.
> If the U.S. aggressively defends Taiwan in an invasion attempt, it won't be because of TSMC and fears of a chip shortage; it'll be because the American public has become invested in the idea of a free and democratic Taiwan,
That, and the concern about China’s long-term ambitions, and what sort of precedent letting them take Taiwan unchecked would set.
However for this, japan and s Korea would be in play. They have to submit to the power that control the sea or 1/2 of Pacific Ocean down to Australia (with a base in South Pacific say).
I was very surprised to find in the recent New Yorker long article about Chinese-Taiwanese Relations [1] that TSMC was only mentioned at the very end. I was expecting this to be central to the story. I recommend reading the whole thing to anyone who has an hour to spare.
"One of the most important deterrents to war is Taiwan’s role in producing semiconductors. Seventy per cent of the world’s most advanced chips are manufactured there, many of them at the Taiwanese Semiconductor Manufacturing Company. [...]China is similarly reliant on the highest-end chips produced in Taiwan; it doesn’t have the equipment or the expertise to manufacture them. If China seized control of Taiwan’s semiconductor factories, it could conceivably force local workers to run them. But the factories depend on a constant flow of Western material, software, expertise, and engineers, without which production would cease in a matter of weeks. Pottinger told me, “If the Chinese took the factories, there’s no way the West would help run them.”"
The real reason we care so much... just look into how power is created by international laws allow landmasses to project power X number of miles out into the ocean. That control plays right into the most influential lanes of commerce in the world.
Sometimes, real life feels like a game of Command and Conquer or Risk, when you zoom back out and boil things down to their most simple form.
If anything the semiconductor industry raises the stakes for the US. The vast majority of chips are manufactured in Taiwan, China, and South Korea. A China that can capture Taiwan can also blockade South Korea, and therefore put the entire world economy at its mercy.
I don't see anything changing yet in terms of Global Influence. TSMC will still have their leading edge, state of art, and majority of capacity in Taiwan for the foreseeable future.
The 4nm US Fab, based on N5, will be two years behind in 2024, where TSMC will be producing N3 class in volume and N2 in 2025. Given the N3 Class are long node before moving to something more exotic and expensive N2 with GAFFET. I would expect the US Fab to be upgraded and start producing N3 in 2026 on US Soil.
>Great news for the US. Great news for Apple, AMD, and Nvidia. Not so good news for Taiwan. The fact that the whole tech world is dependent on chips produced in Hsinchu is a huge advantage for the safety of Taiwan. Moving the fabs and talent further away from the island will not benefit the people of Taiwan at all.
Naive question, can we relocate the people of Taiwan?
Think about that for a second: why would they want to be relocated? And when is the last time you can remember someone deciding "let's relocate these other people that I'm not part of" and that being okay? I mean, one of these relocations is literally called "march of tears".
35 million or so Latin Americans have relocated themselves to the US, even piled into dark crowded trucks and given up their life savings to dangerous coyotes, to do so. I would imagine the the specter of Communist China knocking on your door and breathing down your neck would be a motivator for many Taiwanese. And there would be a great opportunity for the US to welcome them with open arms as allies
They aren't currently living that life so not that many people would want to leave, and leading an exodus of a couple percentage of their population would only hurt their position even more. Most people just rarely ever want to leave their homes until after a disaster has been realized. There is risks anywhere you live, they know their fight, and they are currently making a decent life. Rolling the dice somewhere else just wouldn't be that attractive of a position when it could easily be an immediately worse situation.
You're assuming the population of Taiwan views itself in the same position vis a vis CCP as the government of Taiwan does, which is not a historically probable claim, for all that the situation is quite complex.
Taiwan is a legitimate and robust representative democracy and can quite simply vote itself right into joining with the mainland. The fact that it’s not doing just that tells us that there isn’t a basis to claim that the wishes of populace are not taken into an account by the government.
(And they have in fact just voted in a more pro-China government, so the comment may have a short shelf life).
And not speaking to you directly, but contributing to the general discussion - US opposes China taking over Taiwan using force specifically. If Taiwan were to willingly join with China, one can imagine some conspiracy scenarios, but setting conspiracies aside, there isn’t anything anyone can and will do to prevent it.
A better example might be the wave of Vietnamese refugees who fled the country as the communists conquered the south. Still, being an ally isn’t about accepting a country’s refugees after they’ve been overrun by the enemy. It’s about helping them not be overrun in the first place.
Humans have strong ties to their land. Try getting a sick American rancher to go to the big city for treatment. The people of Taiwan will fight to the death or at least to the point that subjugation is inevitable. And then there will be a resistance.
They're not closing shop in Taiwan, rather manufacturers are shifting away from China and the US government is probably encouraging/subsidizing new plants there. So this is overall a good healthy development that should have happened many years ago.
Doubtful. This is obviously in exchange for continued military support from America. Protection from the world's greatest Navy is well worth a single chip plant.
My initial thoughts on this came the from the opposite side in terms of Taiwans security.
One of the major bounties for invading Taiwan would be in the acquisition and control of their chip manufacturing. Which - as you mention, the entire tech world is dependant on.
By moving some of that capability offshore, that incentive is gone.
> By moving some of that capability offshore, that incentive is gone.
China's main motivation isn't about controlling TSMC, that's just a useful side-objective if it comes to pass. Their main motivations are:
1) break the first island chain barrier and gain a naval base with unhindered access to the Pacific, and
2) shut down a high-functioning Chinese democracy that is a constant reminder to the people of mainland China that democracy works for Chinese people and that they don't actually need the CCP.
These are also the reasons the US and Taiwan's other allies like Japan will continue to defend the country even if it moves some chip production to safer locales.
Perhaps it isn't about controlling TSMC, but control of TSMC would be a very strong leverage over the west.
Not that it is the only or even the most powerful leverage China has over the west, but it is still a massive one, and it has quite a lot of second-order effects.
> but control of TSMC would be a very strong leverage over the west.
They'll never control TSMC by invading Taiwan. TSMC will sabotage their equipment if it looks like a CCP invasion is about to succeed. CCP knows that, it's not their main reason for wanting Taiwan.
China wants to focus more of their economy on internal demand. Something like TSMC, which would allow them to fab CPUs and own more of the value chain in things like laptops and cellphones would help them reach that goal.
Everyone is aware that this would be scorched earth, right? If the fabs somehow survive the initial wave of strategic bombing both the US and Taiwan have an interest in preventing them from falling into enemy hands. In addition, the US will then place China under a trade embargo. And that's assuming that the US doesn't actively engage PRC forces.
To say this would make the world worse off is a drastic understatement.
China absolutely wants to be reunited with Taiwan. Taiwan is a constant reminder of the century of humiliation (Translated term that is basically China's term for Opium wars to WWII). Taiwan is an integral part of the Chinese nation and for nationalistic reasons, it would be an issue even if Taiwan had no other benefits.
> Taiwan is an integral part of the Chinese nation
No it isn't. China under the Communist Party has never ruled or controlled Taiwan (since 1949). Taiwan democratized, developed, and got wealthy first, completely independently of China. Taiwan has never in modern history been an integral part of China.
There's a difference between a nation and a state, although the two are nearly always synonymous in the modern world.
Taiwan and China being one nation is the policy of the governments of both China and Taiwan.
Of course Taiwanese nationalism is it's own thing now, but the Taiwanese people seeing themselves as not Chinese is a relatively recent phenomenon - it's been functionally independent for less than 100 years, and before that it was a Japanese colony like several others that have since been reabsorbed by China.
I'm not supporting Chineses irredentism, and I don't think the parent comment was either. Taiwan should remain independent. What the parent was explaining is why China would want Taiwan no matter what - it's a historical part of China that is relatively recently separated, so they want it for purely nationalistic reasons. It's no different from Serbia and Kosovo, or Russia and swaths of Ukraine. The economics don't matter if all you care about is your wounded national pride.
> Taiwan and China being one nation is the policy of the governments of both China and Taiwan.
No one in Taiwan and not even the current government consider China/Taiwan together. When KMT fled and created the constitution they claim China. Taiwan is now stuck in limbo because the people just want to live their lives in peace and already consider themselves Taiwanese and independent. But if they change the constitution then China will consider it a formal act of independence and use it as an excuse.
You're speaking to the "state" part of the above comment. Yes, clearly the PRC and ROC are not the same state. "Nation" is not necessarily the same thing.
I’m saying despite the constitution. People in Taiwan don’t claim China to belong to them. This is a relic of the past that is stuck in writing that people suffer from.
The pro-independence party just suffered a major loss in local elections. The prime-minister who invited Nancy Pelosi for a provocative visit had to resign. Looks like Taiwanese people are not very enthusiastic about becoming a new Ukraine.
Greens never do well in local elections. Local governments have no say at national level. It seems the only people who say they suffered a major blow are pro CCP bots.
For clarification: It was the President of Taiwan Tsai Ing-wen(as far as I can tell) who invited Nancy Pelosi for a visit. She (the President of Taiwan) did resign as head of her party, but not as president.
China has been a country for longer than the history of European civilization. They do not subscribe to the view that nothing that happened before 1945 matters the way Americans seem to.
China also makes the claim of 1000s of years of history but Taiwans inclusion in that history is about 200 years. And of that less than 10 was a province that China still didn’t govern or control. It was more or less just something they said to deter Japan. So historically China has never ruled over Taiwan. Japan has more claim to Taiwan than China as it actually ruled and controlled Taiwan.
No, China has not been a country for longer than European civilization. That CCP propaganda claim is the equivalent of saying that the European Union has been around for 8000 years because Plovdiv, Bulgaria was founded in the 6th Millennium BC.
Without the staff from TSMC, the Chinese Government probably can't run those facilities. I suspect there isn't much probability that china could mobilize and take those facilities as-is with no sabotage.
ATM PRC assaulting Taiwan would hobble western defense industry. By moving more manufacturing into NA & EU that alleviates it. It helps Taiwan as well who depends on western defense industry.
The Chinese government doesn't run those facilities now, and I agree that they won't be able to do so in the event of a Taiwan invasion either.
That's not the point though. Who runs those facilities now? TSMC aka Taiwan aka a western ally. Who stands to lose the most from TSMC facilities being burned to the ground? Taiwan (obviously) and the west.
As a layman with no background in international relations, to me it seems like TSMC is simply an extra bargaining chip for the Chinese government. Which is why I am all about the idea of building more TSMC facilities in places that are less susceptible to being invaded. And yes, the Arizona plant is just a drop in the bucket compared to their facilities in Taiwan, but you gotta start somewhere, and something is better than nothing in this case imo.
The Chinese government also wouldn't be able to run those fabs without ongoing support from ASML and other key foreign vendors. The production machinery is extremely complex with many specialized parts and a significant software component. Reverse engineering and duplicating everything would take years.
It seems like there are a few key parts that could be removed that would make those ASML machines utterly useless even if Chinese engineers spent time reverse engineering the rest. Surely there is no need to remove or destroy the whole thing as is suggested in other comments.
The equivalent of popping out the Intel/AMD/ARM CPU to disable a computer, and leaving the motherboard, RAM etc.
I've read that TSMC fabs are filled with explosives to set off if China invades so they wouldn't get their hands on tech and equipment. I'm pretty certain that's true, given how important TSMC tech is.
The difference is both sides want that gas to keep flowing (for the time being at least).
Both sides don't want China to take over the technology to produce state of the art chips and control the distribution of those chips. And in case of a war, no way is china continuing to sell those chips to the US defense dept. The profit is negligible compared to their strategic value. Different goals will produce a different result.
That meme makes zero sense considering TW don't want to be a third world economy dependant on exporting fruit even if PRC successfully invades. There's reason TW media was telling US think tanks to leave TSMC alone when US Army War College analysis suggested US should consider bombing TSMC... or exfiltrate TSMC engineers (before children no less) in event of war. As long as fabs and downstream supply chain supplies said fabs are intact, the island will have leverage to remain viable modern economy to support relatively affluent lifestyle. Note the point on downstream supply chain, there's sufficiently exclusive niche semi industries sustaining TSMC on TW that makes it as critical as ASML. Don't expect any Arizona TSMC fabs to operate smoothly without them. If anything, expect TSMC and TW + PRC to collude to threaten TSMC US fabs if try to sanction TSMC TW from making chips in event of successful PRC takeover. The people whose making bank off TSMC will want to so regardless of who rules the island. Ultimately short/medium term also in US interest to keep fabs going because not enough fab capacity will be reshored off island for long time, and the interest groups hurt most is US high tech industry who extracts disproportionate value add from TW fabs. Imaging every company that depends on leading edge chips turning into Huawei/ZTE because 95% of production goes kaput. Currently, cratered TSMC fabs actually works in sanctioned PRC's favour because it dramatically closes relative gap of who has access to high end semi. PRC vastly better off in balance where everyone is mostly stuck on 28nm+ instead of one where US has unfettered access to leading edge.
US military doesn't care. But the TWnese care, which US thinktankers/media, and I'm guessing US based commenters like you seem to forget. Hence the disconnect on why people seriously contemplate these TW will blow up TSMC memes. And why TW media reminding US, that if they're going to evacuate anyone off the island first, it's not going to be their semi engineers, it's going to be women and children. Or that more generally, they're not interested in blowing up their lively hood to stick it to the PRC. Like how in UKR war, it's RU whose blowing up UKR infra and industry when they decided it was better to scorch earth long term.
Yes, Taiwanese obviously care more about their children. But that doesn't change that the US military won't allow the Chinese to obtain TSMC or the knowledge of their engineers.
Sure, except original comment also highlights that the incentives of destroying TSMC is backwards. It's PRC who benefits most from denying US access to TW semi supply chains or engineers not vice versa. Denying TW to US closes relative semi gap for PRC, leveraging PRC control of TSMC in case of successfuly invasion to compel US to lift sanctions also closes relative semi gap for PRC. US has leverage via sanctions during peacetime, but PRC has leverage via threatening access or destruction of east asian semi supply chain during war. Utlimately it's in both US and TW interests for TSMC + co to survive because they extract most value / benefit, but not necessarily for PRC. And for TW, ensuring TSMC+co survival =/= paperclipping them to US. All the interest calculates points towards PRC/TW denying US access, and US wanting continued access since US fabs will still be dependant on TW inputs as much as current TW fabs or future PRC controlled TW fabs will be dependant on US/EU/JP inputs.
But this is missing the obvious. Yes the US would prefer being able to maintain its tech advantage over China by continuing production and receiving of state of the art chips. And this is clearly better for them than choosing that gap by destroying TSMC fab. But if China takes over TW, that's not an option. The options are either flatten the gap or flip the gap in China's favor as it now controls those chips while the US falls back to tech multiple generations old. There is no other strategic option for the US flatten the gap is the only choice, flipping the gap is the worst case scenario for the us.
This deal is in US and TW best interest. TW is still valuable as cutting edge is still made on island. So production and economics so benefit them. US still provides military protection / defense. They are still long term partners will aligned goals. And if China does invade TW, US can continue a long fight and win by falling back only a generation or two to is smaller but important domestic production to continue supporting its defense technology needs.
I can't speak for them, but I have to assume RW also sees its best interests if China invades to lose TSMC plants but US win the war and they maintain democracy, rather than keep TSMC plants but controlled by China and US lose the war and go under full control of mainland rule.
Plants can be rebuilt, just like Marshall plan or what will happen in Ukraine. TW wants long term freedom from China - strengthening US defense's tech position helps this the most.
The obvious option in event of PRC control is everyone deferring to mutual leverage, where US controls fab inputs, TW controls outputs, PRC negotiating access to % of high end production by controlling island. Meanwhile buys both US and PRC time to secure independant semi chain, TW gets to still profit off semi, much like pre techwar arrangment. That's the strategically rare win-win-win scenario where everyone gains / avoids loss vs having accessible leading edge setback 20 years. Of course PRC wins most in this arrangment, and US/TW relatively loses, but if PRC wins in TW scenario vs US, that's going to be least of worries / concessions. The least obvious option is US deciding to scorch earth tech that supports their most competitive high tech industries, responsible for huge % of competitive advantage, especially if that leaves PRC the biggest producer of mature nodes (where things are trending). Even less sensible considering long term timeline after which experts believes PRC can reach semblance of semi parity.
This is short/medium term balance / interest calculation irrespective of the deal - which I didn't comment on - substantial capacity won't shift off TW in the timelines US forecast PRC will make move. Leading edge isn't particularly relelvant to defense hardware ends which use mature nodes, nor does anyone project long fight with how irreplaceable modern platforms are. It's why PRC (and chip partners US is trying to coerce into export controls) views Oct chip curbs as attack on their commercial sector, not military since PRC also have small batch 7nm production capability.
> TW also sees its best interests
It's also obvious "best" TW interest is to hedge having continued leverage over being leading ledge supplier regardless of who wins. There is no scenario where giving away their silicon dominance makes sense, unless coerced to, which is why US had to unilaterally announce export controls - because CHIPS4 partners weren't biting and actively pushing back. Least of all because no one is sure TW can win local war against PRC. Wealthy TW industrialist/elites/chip talent would rather be wealthy under PRC control after war then be fruit farmers because their industry got glassed. Read between line of Morris Chang stating US efforts to reshore chips manufacturing doomed to fail - it's not commentary on US talent - but TW isn't ceding industry to be Americanized. IMO don't expect these plants to launch without hitch. Prolonged war is probably least in TW interests because island simply can't sustain past a few months on domestic resources. There's reason TW defense posture is not prepping for prolonged war like US wants, deep down leadership and industry knows best interest for TW is to survive short/sharp war as developed economy and work with whoever wins.
> strengthening US defense's tech position
Except, again, TW offshoring leading edge fabs doesn't substantively strengthen US defense indy that depend on mature nodes with respect to PRC war. As stated, US fabs will STILL depend on TW inputs for forseeable future - it's not just ASML that's bottle neck - niche suppliers and expertise will be stuck on TW long term. Also consider "partners" pushing back on unilateral US curbs or SKR, JP building out their own indigenous defense industry - very few are actually interested in giving/strengthining US further leverage especially at their cost. And let's be real, fabs aren't going to be rebuilt on TW if they get leveled when they can be reconstructed in more secure locations.
> By moving some of that capability offshore, that incentive is gone.
I'm not sure if that incentive was significant enough. In my eyes, PRC's interest in Taiwan is at best orthogonal with TSMC's manufacturing capabilities.
I thought the same thing. I believe it is more nuanced than that.
PRC wants Taiwan regardless of its production value (geopolitical & PRC narrative) though I'm sure they would like the control of chip manufacturing. However if the US did move all of its strategic production off island there would be less value accrued to defending outside that said keeping a close presence on China expansion is important to the US. So it would still have value maybe a bit less so.
Please excuse the human aspect of the population as we are separating that part of the discussion.
More bleakly, if TSMC is destroyed as a result of invasion, the rest of the world is denied access. This might be to their liking. With some of the capability in the US, they can no longer deny the rest of the world.
They don't really have a choice. Either they build fabs in other countries or those countries will simply invest/subsidize their own fabs (including Intel) to avoid a single point of failure for chip supply.
>Great news for the US. Great news for Apple, AMD, and Nvidia. Not so good news for Taiwan. The fact that the whole tech world is dependent on chips produced in Hsinchu is a huge advantage for the safety of Taiwan. Moving the fabs and talent further away from the island will not benefit the people of Taiwan at all.
Is it possible part of why China wants control of China is to control these factories, so if they move production to America paired with demanding existing diplomatic agreements be honored, China will be less obsessed with seizing, for lack of better phrasing, a unique resource?
The CCP’s intensifying rhetoric about unification paired with Taiwan’s low level of military readiness is somewhat troubling and I’m not sure how much TSMC is going to help matters on its own. A lot of Taiwanese elites have vested interests on the mainland, and CCP subversion and espionage are reportedly rampant. At some point Taiwan is going to have to be willing to actually defend their sovereignty.
Does China still want Taiwan if it's no longer technologically relevant? My understanding is that China is making similar strides in its own chip industry to the point where TSMC won't be as nearly as useful to them in 10 years as it is now.
Taiwan also serves the role as an unsinkable battleship right next door to Chinas mainland. Its military value extends far beyond its chip production capabilities in order for the US to check Chinas influence in SEA region.
The U.S. military doesn't stage any assets in Taiwan, not since shortly after rapprochement with China and establishment of the current strategic ambiguity. The U.S. military is very careful about both what and who it officially permits to land on Taiwan. Occasionally (on the order of years) there are borderline cases, such as a research vessel with U.S. Navy ties docking in Taiwan, and it becomes a huge thing in the Chinese media. AFAIU, high-level officers are rarely if ever given permission to enter Taiwan; direct military liaisons in Taiwan are limited to lower level staff officers. When this protocol is broken it's a tit-for-tat situation designed to send a message, and doesn't change anything of substance in how the relationship operates.
Anyhow, the U.S. has no need nor desire to establish a presence on Taiwan. Okinawa and Korea are more than close enough for its purposes, peaceful or otherwise. And if the U.S. were to try to establish a presence, you can be sure China's invasion fleet would reach Taiwan before any significant U.S. materiel could make it ashore.
Taiwan does far more than just TSMC. That is just one single company, albeit a very essential one. For instance, I don't like to buy hand tools (impact sockets, torque wrenches, etc) made in China, but Taiwanese tools are a higher quality and I have no hesitation purchasing them.
I suspect that the hand tools made in China aren't low quality because China doesn't have the tech to make them better, but instead because making cheap low quality tools is more profitable.
In fact, when taking apart China-made, China-designed products, I am frequently very impressed at cost-cutting measures that are taken with minimal impact on the functionality of the product.
Many computer/electrics manufacturers and OEMs, like ASUS, Acer, Foxconn, Wistron, Pegatron, MediaTek, Synology, etc are HQ'd in Taiwan. Though PRC company may be able to supersede them, unlike TSMC.
> Essential for you. But overall tsmc eclipses everything else Taiwan makes.
TSMC’s revenue is less than a tenth of Taiwan’s total export revenue. They might be the most profitable of Taiwan’s companies, but Taiwan has a huge economy.
And it terms of impact on the world economy, Hon Hai precision, better known in the west as Foxconn, would like to say hi.
China wants Taiwan orthgonally to any economic value it would provide. Reunification is pretty core to their mythos at this point.
In fact, I wouldn't be surprised if making Taiwan globally less economically relevant is core to their strategy for reunification. While the US is dependent on Taiwan for chips, Taiwan has a very important defense partner that China can't really compete with. But China has a way better chance of securing Taiwan if the rest of the global community only cares for ideological reasons.
Technically, since Taiwan isn’t recognised as a country they can’t be a signatory of the nuclear non-proliferation treaty. They only thing stopping them developing nuclear weapons is political pressure.
the issue is "is it healthy for the country" which being taken over by china is not, so you aren't really addressing either the question I was responding to, or my question.
Well that's debatable. It depends entirely on how you define "healthy". We tend to look at things from a Western perspective, but that's rather presumptive isn't it?
What's presumptive is to call something debateable without making a persuasive or even barely logical argument, throwing in a random jab at perspective without offering any opinion to talk about, and then calling your opponent presumptive.
Basically you have no argument and no position except to be rude.
> WASHINGTON, March 11 (Reuters) - Ukraine's two leading suppliers of neon, which produce about half the world's supply of the key ingredient for making chips, have halted their operations as Moscow has sharpened its attack on the country, threatening to raise prices and aggravate the semiconductor shortage.
Every Russian soldier, vehicle, or round of ammunition expended in Ukraine for increasingly diminishing returns is a Russian soldier, vehicle, or round of ammunition that will never harm a NATO member.
> Every Russian soldier, vehicle, or round of ammunition expended in Ukraine for increasingly diminishing returns is a Russian soldier, vehicle, or round of ammunition that will never harm a NATO member.
Sure, and it's also 10 dead Ukrainian soldiers that will never return to their families, and a few thousand people living an extra day in war, and a few hundred more Ukrainian refugees that must be subsidized in Europe, a few dead Ukrainian civilians that die of Russian shelling, and a few dead Ukrainian civilians in Donbas that die of Ukrainian shelling, and the further demilitarization of both NATO and the US as they run out of munitions and equipment to send (and lack the industrial base to make up for the shortfall). It is also a few more percent lopped off of European GDP as the continent plunges into a steep recession due to the energy crisis.
It is only by weighing of the lives of the people in the conflict at zero that the U.S. justifies prolonging this proxy war and continuing to arm and subsidize Ukraine.
It is truly willing to fight Russia until the last Ukrainian, and until Europe is completely de-industrialized.
> It is only by weighing of the lives of the people in the conflict at zero that the U.S. justifies prolonging this proxy war and continuing to arm and subsidize Ukraine.
Ukraine is literally fighting for their sovereignty, America is helping them push the Russians, who are raping and torturing citizens out of the occupied territories.
Every weapon to Ukraine is time less under Russian occupation, which is a good thing.
You seriously believe that the US or EU care about the sovereignty of other nations? America has invaded or attacked over 120 nations since 1991. We currently have troops in Syria extracting oil and are still occupying Iraq. We just helped organize another invasion of Haiti, after murdering their President and replacing them with a US puppet. We just tried to overthrew the government of Ethopia by backing the Tigray rebels. We overthrew the government of Ukraine twice, in 2004 and 2013. We overthrew the government of Iraq and are financing violent rebels to overthrow the government of Myanmar. Only strong, large nations that can stand up to the US and other rival great powers have any hope of achieving sovereignty. Ukraine has never had it.
So please stop with this new found interest in the "sovereignty" of US client states. We have tape recordings of US state department officials deciding who will be in the Ukrainian cabinet and who wont, of what their policies can and can't be. One phone call from Washington and there is a third coup in Ukraine with Zelensky out the door and another US puppet installed. So Ukraine has zero sovereignty, and that's true regardless of what happens in this war. The only question is whether it will continue to be ruled from Washington or whether it will be ruled from Moscow. That is why this is a US-Russia proxy war, with Ukraine stuck in the middle.
> We have tape recordings of US state department officials deciding who will be in the Ukrainian cabinet and who wont. of what their policies can and can't be.
If you could provide a source for this, that’d great.
> One phone call from Washington and there is a third coup in Ukraine with Zelensky out the door and another US puppet installed.
Zelensky was elected in an election, I know you likely don’t know this so I just thought you should know.
> So Ukraine has zero sovereignty, and that's true regardless of what happens in this war.
It’s actually not true and patently false.
> The only question is whether it will continue to be ruled from Washington or whether it will be ruled from Moscow.
Even if these were the options (and they aren’t cause Americas not looking to rule Ukraine). The choice is clear, being ruled by Moscow which leads to the rape and torture of your civilians(including children), or being ruled by America which leads to not that.
> That is why this is a US-Russia proxy war, with Ukraine stuck in the middle.
Russia keeps changing the reasons they invaded the current reasons have nothing to with America but I’m sure they will change next week.
> Zelensky was elected in an election, I know you likely don’t know this so I just thought you should know.
In an environment in which rival political parties were banned, torture centers were established, death squads were roaming the streets arresting dissidents, etc, and there was strict control of media.
But in some sense elections in client states don't matter. Zelensky was elected on a peace platform and immediately was forced to abandon his stance on implementing Minsk 2 when he got into power - 70% of the population wanted it implemented. Minsk 2 was the agreement Ukraine signed with Russia to avoid war. Minsk 2, which was brokered by the EU after the violent anti-Russian Maidan coup. It called on Ukraine to grant autonomy to Donbas and to respect the rights of the Russians living there. It also called on Ukraine to recognize Russian control over Crimea. In return, the Donbas provinces would return to Ukraine and Russia would recognize the coup government, and there would be no war. Poroshenko stated he had no intention of ever implementing Minsk 2, but signed it to buy time for Ukraine to arm itself to fight a war with Russia. US Senators McCain and Lindsey Graham visited Ukraine and urged them to defeat Russia in the war. This was 2015. The US was clear that Minsk 2 would never be implemented by Ukraine and that it was just a lie to buy time as they geared up for war.
So in a place like Ukraine, it doesn't matter who is elected as long as the US controls the country. Zelensky was elected on a peace platform and pro-Minsk 2 platform, and immediately changed his position after the election. This is something you should also research if you want to be informed.
> The choice is clear, being ruled by Moscow which leads to the rape and torture of your civilians(including children), or being ruled by America which leads to not that.
No, it is the Maidan regime that set up SBU torture centers, burned people alive, buried people alive, funded various Neo-Nazi groups like Aidar, Right Sektor, Azov, banned the use of Russian language, disappeared pro-Russian citizens, banned pro-Russian parties, banned pro-Hungarian parties, etc, and they were committing and continue to commit mass atrocities. There were many articles by Amnesty International and other human rights groups about this.
> Russia keeps changing the reasons they invaded the current reasons have nothing to with America but I’m sure they will change next week.
This is just made up nonsense. Putin gave a speech explaining the reasons for the invasion - the liberation of pro-Russian Donbas region, preventing Ukraine from hosting NATO troops/bases, and the denazification of the country. These were the three reasons. You can try listening to this speech rather than making up your own reasons, and then listening to his other speeches across time (he gives many speeches about Ukraine), and seeing if there is a change. He has been fairly consistent -- much to the anger of the Russian population which wants a far more hardline position on Ukraine, particularly in light of all the ethnic cleansing and atrocities committed by this US client regime. I would say, however, that as the war drags on, there is a real chance that Ukraine will end up partitioned into nothing, which is an object lesson to other regimes that wish to be U.S. clients. This is probably why Taiwan kicked out the pro-US party in the recent elections -- they don't want to be a battering ram the US uses against China and then discards when their powerful neighbor attacks them. Again, in all of this, it is Ukrainian people that suffer, whether they be of Russian, Hungarian, Polish, or Ukrainian ethnicity. The US doesn't treat its client states very humanely.
But I take it that now we agree on the larger point that this proxy war has nothing to do with "sovereignty".
This does not claim at all what you think it does.
> In an environment in which rival political parties were banned, torture centers were established, death squads were roaming the streets arresting dissidents, etc, and there was strict control of media.
What?, Zelensky was elected in 2019, 5 years after the Maiden revolution you know that right?. Do you have _any_ proof at all, that isn't thinly veiled Russian propaganda?.
> So in a place like Ukraine, it doesn't matter who is elected as long as the US controls the country. Zelensky was elected on a peace platform and pro-Minsk 2 platform, and immediately changed his position after the election. This is something you should also research if you want to be informed.
Theres literally zero proof the US controls the country, the Ukrainian government didn't even believe the Russians were going to invade. Probably because the Russians themselves continued to say they wouldn't and the Ukrainians put misplaced trust or maybe misguided hope in the words of the Russians.
> No, it is the Maidan regime that set up SBU torture centers, burned people alive, buried people alive, funded various Neo-Nazi groups like Aidar, Right Sektor, Azov, banned the use of Russian language, disappeared pro-Russian citizens, banned pro-Russian parties, banned pro-Hungarian parties, etc, and they were committing and continue to commit mass atrocities. There were many articles by Amnesty International and other human rights groups about this.
We literally have videos of the Russians committing war crimes against Ukrainian civilians, including execution and castration and we have many many many independent reports of torture and sex crimes including against children.
It would be nice if you source any of what you say, your stream of conscientious is not really a source.
> preventing Ukraine from hosting NATO troops/bases
aka, preventing Ukraine from protecting itself from future Russian attacks.
> much to the anger of the Russian population which wants a far more hardline position on Ukraine, particularly in light of all the ethnic cleansing and atrocities committed by this US client regime.
This is literally fake news, there is no proof at all that isn't just straight Russian propaganda of any 'genocide' in Ukraine outside of the one that Russia is committing.
> I would say, however, that as the war drags on, there is a real chance that Ukraine will end up partitioned into nothing, which is an object lesson to other regimes that wish to be U.S. clients.
I dunno, Russia is currently sending out under equipped mobilised citizens with T-62s and keeps recruiting from prisons whilst Ukraine is still fielding T-64s and better equipped and trained soldiers. Russia keeps getting more and more desperate every week, their army has been largely reduced to a pathetic bunch of barely trained cannon fodder lately.
I see the Russian army collapsing before Ukraine gets 'partitioned' by some mythical boogey man that doesn't exist.
> But I take it that now we agree on the larger point that this proxy war has nothing to do with "sovereignty".
This war has everything to do with Ukrainian natural resources and sovereignty, the Russians don't see the Ukrainians as a seperate people or as a real country and feel their position as the worlds gas station is threatened by the natural resources in Ukraine.
on Minsk-2 why would anyone believe what Russia says in any international agreement they already promised to not invade Ukraine or even threaten there sovereignty under the Budapest Memorandum?.
> America has invaded or attacked over 120 nations since 1991.
[citation needed]
> We currently have troops in Syria extracting oil
We have a few troops in Syria, but while the Syrian regime and its allies continue to claim the thing about stealing oil, no evidence of any kind has been offered to support that that has been happening since Biden ended the Trump policy around oil extraction.
> We just tried to overthrew the government of Ethopia by backing the Tigray rebels.
No, we didn’t. In fact, the US government has condemned abuses by all sides, including the TPLF, and sanctioned actors on all sides, including in the TPLF, for abuses in the conflict.
> We overthrew the government of Ukraine twice, in 2004 and 2013.
We didn’t overthrow the government of Ukraine at all. The main organized, non-grassroots actor in the overthrow of the regime that stole the 2004 election appears to have been the Ukrainian security services.
> We overthrew the government of Iraq
The first not-lie in your entire recitation.
> and are financing violent rebels to overthrow the government of Myanmar.
Myanmar has…quite a variety of different internal conflicts and rebellions, but while a number of actors have urged the US to back forces working against the regime that recently seized power in a coup, it is not doing so.
> Only strong, large nations that can stand up to the US and other rival great powers have any hope of achieving sovereignty. Ukraine has never had it.
I dunno, Ukraine’s doing a pretty good job of standing up to a supposed great power right now (and its only getting substantial Western aid in doing that now because it initially did much better than anyone expected without it.)
> The only question is whether it will continue to be ruled from Washington or whether it will be ruled from Moscow.
No, the only question is whether the Putin regime will give up its imperial ambitions before it collapses, or because it collapses.
Fair point, but the rest of the world will still be customers for chips made in Taiwan, and US defense promises to Taiwan are likely worth more if the economic flows are not just unidirectional.
No the reason they want to invade is to project power into the wider pacific, nationalism, imperialism and the people and human capital not just limited to semi conductors. The factories will be destroyed in any invasion, the US will guarantee it, I promise.
I doubt the parent has access to American war plans, but it's reasonable to guess that the US would prefer for China not to have intact TSMC plants because it provides enormous leverage. It's the same as blowing up Nordstream II. This is standard war stuff, and if the US is at war with China, heavy sanctions, etc, we wouldn't be able to buy the chips anyway. Why not drop a cruise missile on it?
Personally I hope such a thing doesn't happen. If I had to guess, Taiwan will eventually come under mainland China's control, but I hope this is done very slowly and in a bloodless way following a referendum by the Taiwanese themselves (e.g., only after certain guarantees of autonomy are made and the Taiwanese opt for the 'easy route'). I doubt mainland China will accept this thorn in their side indefinitely.
It may end up being a question of choosing to be Hong Kong or choosing to be Ukraine.
China doesn't want this to be like the Ukraine conflict either. I don't know if and how guarantees of some autonomy can be made that carry some significant degree of trust, but it's the least bad solution for all parties to make that happen.
Mutually Assured (Economic) Destruction. If destroying the TSMC factories is off the table, then China is incentivized to invade (to capture leading edge chip production). If the fabs are destroyed, it would take years to rebuild, which will cripple Chinese production of consumer goods using those chips.
Personally, I would be shocked if the US military doesn't also have a plan to "relocate" strategic personnel to the US in the event of invasion by China.
I’m not sure it’s proven China can build better products under their system than countries with freedom. Maybe only DJI are doing this in the consumer space today. The West/Japan/SK/Taiwan are still massively ahead in building the more complex components that China then assembles.
It appears the West is slowly untangling their economies from Chinese dependency and about 1/3 of stuff is made there today. With zero covid making them an unreliable manufacturing partner I doubt this will increase in the short term. I am pretty sure high end fabs will be returning to the west very soon and America could not have a better competitor than China to push them forward to new heights. I would bet on free countries producing most on the innovation over the next 20 years.
The reason China want Taiwan is because it poses an existential threat to the CCP, same story with Hong Kong, Taiwan has the same cultural roots as mainland China, yet they pursued democracy and free markets, despite not having access to the abundant natural resources of the mainland, its GDP per capita is roughly double that of the mainland, and its citizens enjoy a more free society.
What greater example is there of the abject failure of Chinas communist rule?
It is categorically NOT a huge win for the stock. This is all happening because of US subsidies.
The US has more expensive workers who are overall worse at the job and don't have the expertise to be compete with the people in Taiwan.
The subsidies only make this a viable option for political reasons. The decision to create a fab in Arizona is strictly speaking unprofitable and essentially a economically irrational move for the company.
It is ONLY being done because of US demand and political tension from China. For a shareholder this move is not good when looking at it in terms of profit.
I know this is a hard pill to swallow but it's true.
Don't joke about Europe. The best place for tsmc to expand is actually china. But this won't happen for various reasons that we all know about.
> The US has more expensive workers who are overall worse at the job and don't have the expertise to be compete with the people in Taiwan.
Putting the rest of your statement aside, this is a very silly thing to say. The United States invented the IC and started silicon age. Integrated circuits made in Silicon Valley were literally on the moon at the same time that Taiwan was still an incredibly poor country living under martial law.
Maybe today there aren't the exact people in the US to compete with Taiwan on this chipmaking process, but that doesn't mean the US lacks the ability to compete. It's not about general country-wide work ethic. If the right person to get the job done is a one-in-a-million person... well the US has 330 of them vs 23 in Taiwan.
Countries change over time. If the US has the ability to compete with Taiwan in semiconductor manufacturing, we sure haven’t shown it in recent decades.
IBM and Intel are competitive with TSMC and Samsung when it comes to ability to cram transistors onto wafers. This idea that only Taiwan/TSMC knows how to fab is light years from reality.
Well, that is certainly the Chinese government's take on things.
Your posts suggest that the US should just give up and let Asia -- more specifically China -- dominate semiconductors forever because US workers are lazy, fat, and stupid. Am I characterizing your position correctly?
I am simply stating the truth. It is from the perspective of a tsmc shareholder not a patriotic American who wants to beat china for no other reason then being the best.
As a tsmc shareholder one part of your post is correct. US workers are unfortunately lazier and slower and more expensive. Not necessarily stupider. You characterized this part of my position partially correctly.
As for what the US should or should not do, I never commented on that. Your patriotism and defensiveness specifically injected rivalry into your response. I literally have no opinion on what Taiwan or China or the US should do. I am neutral on that front.
> US workers are unfortunately lazier and slower and more expensive
I guess we just kinda stumbled into being one of the wealthiest and most developed countries in the world while having the lazier/slowest/most expensive workforce.
> The US has more expensive workers who are overall worse at the job and don't have the expertise to be compete with the people in Taiwan.
GMAFB. Intel has several of their fabs in the Phoenix metro area, they’re another 3-5 major players in the area, and there’s a talent pipeline from the local University into these companies.
Intel’s problems aren’t an inability to fab, it’s an inability to translate their design language into the new, smaller process.
It's universally well known that Asian workers work harder and can be paid less.
It's not just about intels capabilities. It's about economic wage standards. The cost is just too high in the US.
That being said tsmc workers in Taiwan are by far more capable then Intel this is proven by the 3nm process of which Intel is completely incapable of achieving.
You have posted many times in the thread saying the same thing, but slightly moderated because you got flagged.
You said elsewhere "things change" regarding labor force quality. They do. Asian labor across the board, but especially in China, has been rapidly increasing in cost while for example USA labor is stagnant in overall cost. Apple is medium-term going to be priced out of China just by labor costs. It is actually smart in a real-politik sense (and a business sense you deny) for labor sourcing to start looking a lot more broadly at different countries on a cost basis. USA is rich in some measures, but in terms of purchasing power and compensation of much of working class, it no longer is.
As for the quality of USA workers you've commented on a lot, I'll give you there is a serious decline in education. Saying they are slow or lazy shows you don't know anything about USA. The vast majority of the country is working itself to death and the life expectancy is cratering. As sad and reprehensible as it is, from the kind of logic you're using, a desperate and broken workforce is a GREAT business opportunity.
There is something beyond "American Exceptionalism" and "Asian Exceptionalism" and I think you really need to find it.
I always feel there's some implicit racism or belief in cultural superiority or something at play in these discussions. Anyone who has gone to grad school can see pretty plainly that the top schools are stuffed with Chinese and Indian nationals. They're capable and they work hard. Some of them, not a small number, go back home. Further, western industry set up shop in Asia for their own reasons and brought their expertise over.
The west had a lead, but 'we' trained Asians at our top institutions and worked closely with Asian manufacturers so that they can make our most sophisticated products more cheaply. There are a lot more people in Asia, and high relative poverty and cultural practices encourage a higher degree of scholastic achievement. Of course they're beating us now.
Outside of a very explicit and intense effort to develop domestic talent and retain foreign talent (or bloody wars), the west probably won't ever really lead ever again. This was the obvious outcome decades ago, but these things take time. The gap will grow and will extend up the value chain--western nations will do protectionism to try to slow this (e.g., Huawei, current chip restrictions), but cat's out of the bag.
I don't think it's a good or a bad thing from a global perspective. It just is. The great power competition that may result, wars, etc, is a very bad thing. The US in particular should compete as best it can, but it's best for everyone if we learn to live in a multipolar world.
> Anyone who has gone to grad school can see pretty plainly that the top schools are stuffed with Chinese and Indian nationals. They're capable and they work hard.
People in grad school tend to be hard working and smart, that’s how they got there. Hypothesis: foreign nationals have to be even smarter and harder-working to secure places in US universities, hence the stereotype.
It wasn't my experience that they were harder working or more capable than the domestic talent. Because of the immigration benefits, some had additional motivations native-born Americans didn't have, but there are easier ways to immigrate. There were some differences culturally in how certain things were approached, but I thought capability wise there was not an obvious and significant disparity in terms of capability of students by national origin.
What was noticeable is that there were a lot of these students and to the extent that the US does not retain them, we are training the workforce of our competitors. To the extent we do retain them, we are poaching the talent of our competitors. My guess is this is tough to balance and where we're at now is making total global innovation higher but lowering the proportion of the pie over which the US has dominion.
What percentage of the chip cost is the wage cost? This might be relevant for a 90uM process, but I think at 4nm, the wages are a minuscule part of the production costs.
Should be a huge portion of the cost. The material is just silicon. The expertise and know how that goes into this is where most of the money goes. For Taiwan, this expertise is better, faster and cheaper.
Those billions are also mostly R&D. It's also from a country external to Taiwan. ASML, the Ductch.
Yes, Obviously there's a lot that goes on in this process, more then "just" silicon. But if you want a summary, then cost expertise and knowhow, eclipses actual process. In a sense it is just "silicon" when measured relative to the ability and knowledge required to transform that material.
Chip-making isn't the same as sewing together cheap trinkets, and the Chinese economy has changed to support a growing middle-class so the reality of Chinese labor costs has drifted from the stereotype in recent years (especially in the domain of skilled labor).
Not to mention the lack of seismic activity and humidity that AZ offers.
The main reason is the looming threat of invasion of Taiwan from China. Such an action is catastrophic for Taiwan and the US. I thought this was obvious. Guess not.
The US is an easier espionage point for the US to steal technology from Taiwan. Most likely it will happen. But simple espionage isn't enough for this technology to fully transfer. The expertise and knowhow is just too challenging.
Do not let your patriotism blind you from the moral grayness that operates within the US as well.
Does TSMC "own" the technology? Because their fabs are wholly dependent on ASML, a Dutch company. And they're using that to produce tech that's designed in the west as well.
Right, only culturally European people know how to do anything. Those Taiwanese are just factory workers, no expertise at all, that's why Intel is in such good shape these days. Chipmaking is obviously so easy the only reason we let them do it is to keep the price down. /s
They obviously have expertise, the point is that the parent was implying that all the tech involved is exclusively TSMC's, which is also wrong. The parent literally said the US is trying to "steal" TSMC's technology...
So maybe read my comment in context instead of implying racism right off the bat SMH.
> The best place for tsmc to expand is actually china.
The chinese are vastly worse at fab than americans. Why do you point out that american workers are worse than TW, but neglect to mention that Chinese are even worse?
Not trying to make a judgment about people from USA, CN, TW as a whole - mostly just a function of experience.
Because they're not. PRC has worst fabs due to equipment sanctions, and now expertise sanctions (first by TW, then US). But said sanctions were placed at all because the cost and quality (east asian work ethic etc) of PRC semi workers weren't in question. Versus US workers being described as "group of giant babies" by TSMC employees ranting on PPT about doing more work for less pay than Americans in Arizona. Experience doesn't matter if you don't work hard enough. It's precisely because PRC workers, who can keep up with TSMC "military" pace, have demonstrated potential to run great fabs that led to companies like TSMC expanding in PRC in the first place, and why US had to do export controls, and do massive CHIPs subsidy to get fabs on US soil.
Good thing a stock price is about the future growth of a company. Hell, many public companies are valued at billions but still take a yearly loss. They are "subsidizing" their own growth in a sense.
After flooding took out most of the world's magnetic hard drive manufacturing capacity, it seemed clear that absolute efficiency in the immediate sense was the enemy of a robust long term manufacturer. I'm not sure why human v human threats are being heeded when nature v human ones were not, but diversifying your locations absolutely makes sense. There are some geographic constraints to where locating fabs make sense. And cost of living has to be balanced with the need for knowledge workers.
If you ran TSMC and you wanted to be sure no single disaster or war destroyed your whole manufacturing capability, where would you put the fabs? China's coast seems too close disaster wise and the same war that would dust your TW masks might destroy those too. Middle east maybe for climate and shipping logistics? Then one in the EU, perhaps spain? North america is probably third choice, and between climate and cartels that probably means the US. If third pick is paying you to go there, maybe it does make good sense.
I think you are certainly right, but why focus on Asia exclusively as a second fab location? One earthquake could flood all of them. As I said, oil giants in the middle east trying to diversify seems pretty ideal. I only suggested EU for the knowledge workers and it faces a different ocean.
From a geopolitical standpoint, US investment in Vietnam’s manufacturing capability would put pressure on China. China is trying to move up the value chain with Vietnam already eating their lunch on the low end.
Long sigted. The investment starts from scratch. Why not invest in some places cheaper? Why not invest in a place that has better expertise?
Overall the long term vision is to wrestle some control away from China. That is the long term bet the US and tsmc are ultimately making and what's driving the decision. But economically this is a bad bet.
