From Asia Times, January 31:
The challenge of reviving US chip industry
The semiconductor industry was invented and developed in the United States, yet most of the highest-performance chips are now produced by Taiwan Semiconductor Manufacturing Company (TSMC), with more than US$70 billion of annual revenues solely from chip manufacturing of devices designed by others.
Such devices are key enablers of all high-performance electronic systems. Faced with defense-system concerns, the US government is providing $50 billion to fund the most advanced new chip production plants domestically. The idea is to revive high-performance chip production in the US.
Based on my experience, I believe that high-end chip manufacturing is the most challenging in the world. It costs billions of dollars to build such plants, but that’s only the beginning: The qualified staff to operate them cannot be purchased – they need to be trained and developed in a production environment.
Such a program will not succeed without a major increase in the number of sophisticated technologists capable of operating such plants.
TSMC’s much-heralded American plants, to be built with US government subsidies, have been delayed repeatedly – something that doesn’t happen in Taiwan. A plant scheduled to open in 2026 won’t be operational until 2027 or 2028, TSMC said on January 19. The opening of another plant was delayed to 2025 from a planned 2024 opening. The company blamed a shortage of skilled workers.
I have been involved in the design and operation of chip plants since the 1960s. They require uniquely qualified people trained over periods of not months but years. The equipment to build such factories is commercially available and is extremely complex and automated.
But the key manufacturing enabler is the people who operate it. It takes years to develop such expertise, and it is rare in the United States, as such manufacturing has largely gone overseas, leaving Intel as the only domestic manufacturer of high-end chips.
The United States still leads in the design of the highest-performance chips, and the recent success of Nvidia with leadership in AI-enabling chips (produced by TSMC) is an indication.
With the exception of Intel, the US industry was happy to outsource the production of the most sophisticated integrated circuits to TSMC, which proved to be a reliable leading-edge production company.
Gradually, TSMC acquired the facilities and skill to produce the best leading-edge devices designed by companies globally. It is today a very profitable high-volume chip manufacturing technology leader. With scale comes market position and economics of production, and the company is very profitable. Any potential competitor has many barriers to overcome, and the biggest ones are in management and staff expertise....
....MUCH MORE
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