Friday, May 15, 2020

Taiwan's TSMC To Build A $12 Billion Chip Fab in Arizona

No one builds these thing in California anymore.
From Reuters, May 15:

Taiwan's TSMC keeps eye on China with $12 billion U.S. plant
In a race to position itself in the latest trade battle between the United States and China, Taiwan Semiconductor Manufacturing Co Ltd made it just under the wire.

The world’s biggest contract chipmaker unveiled plans for a $12 billion plant in Arizona on Friday just hours before Washington outlined a proposal to amend tech export rules that could restrict TSMC’s sales to China’s Huawei.

A U.S. Commerce Department official said TSMC’s decision to locate the plant in the United States generated “good will” at the department, the drafter of the law that would require TSMC and others to get U.S. licences to sell chips to Huawei.

The move shows the delicate balancing act by TSMC to stay on side with Washington, which has stepped up criticism of Chinese trade practices and Beijing’s handling of the novel coronavirus, while protecting its China business, analysts said.

“TSMC has to figure out how to best leverage and benefit from the U.S.-China tensions,” said Liu Pei-chen, tech analyst at government-backed think tank Taiwan Institute of Economic Research.
It could not escape them so its room for manoeuvre consisted of negotiating the best terms for the U.S. factory it could, she said. Analysts estimate TSMC generates around 60% of its revenue from the United States and some 20% from China.

Liu said TSMC would enjoy the first-mover advantage as U.S. President Donald Trump seeks to wrestle global tech supply chains back from China ahead of Nov. 3 presidential election.
U.S. government officials were not immediately available to comment on whether the investment would make it more likely that TSMC would get a licence to supply Huawei....

Although the article focuses on the Huawei angle there is a lot more going on here.
January 16 
As Concern Grows Over China’s Invasion Threat To Taiwan the U.S. Military Wants TSMC To Move Some Chip Capacity
And some thought I'd gone mad talking of chips and China and the island formerly known as Formosa (at least to the Portuguese).
p.s. can I start attending the Thursday soirées again? Please....
A couple posts from last summer. Frirst up, the intro to July 3's "China to Narrow Chip Gap With Taiwan Invasion"
Did I say invade? I meant trade.
I must have been thinking of China's Defense Minister last month saying "China must be and will be reunited".
With the Taiwanese elections coming up it's probably as good a time as any for Beijing to make some sort of move. Probably not invasion though. China will want to test its military somewhere, our guess is Vietnam, before tackling Taiwan. So probably some sort of fifth column action, cyber, electrical grid etc. And the people to do it are already on the island, I mean if the Chinese could get one of their spies into Dianne Feinstein's office while she was Chair of the Senate Intelligence Committee (2009 - 2015), the guy was her San Francisco office manager, not, as reported, the chauffeur, if they could do that there is no doubt they have assets in Teipei.
So where was I?

Chips. For all their technological wizardry the Chinese are still having trouble making chips. Some of our links on that after the jump....
And August 28:
Chips: How China Is Still Paying the Price For Squandering Its Chance To Build a Home-grown Semiconductor Industry 
Should China ever invade Taiwan the TSMC fabs would be quite a prize.
We've looked at this oddity a few times, some links below....
Intel is known in some circles as Chipzilla but, truth be told, the appellation might more accurately belong to TSMC.

And on chip fab's in Cali:
January 2019

"Intel to Invest $10.9 Billion in New Israeli Fab" (INTC) 
Intel has publicly stated they will never again build a new factory in California. In fact, when they closed Santa Clara's D2 fab in 2008 it was painted as the last Intel manufacturing plant in Silicon Valley.
It was, in fact, the last Intel manufacturing facility in the entire state of California.
Though still headquartered in Santa Clara they do their manufacturing in Oregon and Arizona and now Israel.

October 2019 
Do You Want To Know Why Intel Said They Would Never Build Another Factory In California?