25 ms·

TSMC Announces Intention to Build and Operate Advanced Semiconductor Fab in U.S.

540 points by ytch 6y ago

lawrenceyan 6y ago
Some competition with Intel in their home turf I see.
- bob1029 6y ago
  This is an excellent strategy if you want to decimate the talent pool of your competitors and simultaneously ramp production without having to build local staff from zero. With some aggressive incentives, they could probably snipe a lot of talent from across town. Worst case, they will just fly in hundreds of existing, trained employees from Taiwan until the local workforce is stabilized. This is how Samsung bootstrapped their ATX factory.
ccmcarey 6y ago
Only a few days ago they were saying they had no specific plans for a US fab (https://www.digitimes.com/news/a20200512PD202.html https://www.digitimes.com/news/a20200512PD202.html). Nice that Intel will have more local competition.
rough-sea 6y ago
Why are fabs being built in az?
- kyrra 6y ago
  Guesses: away from fault lines? Dry climate? They get some nasty rains that flood things, but better than tornados, hurricanes, and earthquakes.
  - throwawaybanjo1 6y ago
    ^ This. Also explains why there's so many data centers. Cost too. Land & power are both cheap.
    - madengr 6y ago
      I'm sure evaporative cooling is cheaper too, compared to some place where it's too humid.
- magicsmoke 6y ago
  ASU puts out some pretty talented semiconductor engineers, and ON Semiconductor is a major supplier based in Phoenix
  - 0xDEADBEF 6y ago
    ASU isn't exactly a premier college for engineering. They have good parties tho
    - magicsmoke 6y ago
      Maybe not for undergrad, but undergraduates don't learn how to do semiconductor manufacturing.
  - 3fe9a03ccd14ca5 6y ago
    And there’s existing talent because Intel has chip fabs there.
- antishatter 6y ago
  Intel has a big AZ presence, I wonder why AZ specifically. Maybe climate? Maybe so TSMC can poach some talent? It's a really great question and if anyone has specifics I hope they chime in.
  - elihu 6y ago
    Probably also a pretty good existing ecosystem of 3rd party contractors and suppliers that support the Intel fabs and would be happy to do business with TSMC as well. edit: also, a minor quibble: I wish we'd get away from calling it "poaching", as if there is anything illegal or immoral about employers competing for employees.
- clumsysmurf 6y ago
  Business friendly state that has low oversight into what goes into our environment. We have an EPA superfund site near an old Motorola plant.
  - khuey 6y ago
    Santa Clara County is full of Superfund sites from old semiconductor factories so there's nothing new there.
- lpetross 6y ago
  AZ has been a semiconductor hub for decades. Intel, Motorola, ON and many others produce chips there. There is huge infrastructure and talent base for semiconductor manufacturing. Geographically, Chandler as a suburb of Phoenix has consistent weather, relatively cheap land, and access to water - as counter-intuitive as it sounds. I did my PhD in semiconductors at ASU and there might has well been a bus direct from the University to Intel. Keep in mind, we're talking about PRODUCTION, not R&D. R&D happens elsewhere, this is just where the big plants go.
  - specialist 6y ago
    Thank you for providing context. During the 80s & 90s, one of my besties worked on building fabs in and around PHX. Really exotic stuff that I didn't really understand. He'd joke that he had a PhD in welding. He claimed at the time that fabs were migrating from California to PHX and ABX to avoid environmental regulation (enforcement) and cheaper water. While he was concerned about building future superfund sites, he also knew he'd never make that kind of money doing any other kind of work. If you don't mind, I'd really appreciate your take. I still have family in Phoenix. I've always been concerned about toxins (air and water). And I'm also grumpy about megacorps guzzling all the water at discount prices. So while I'd love for TSMC to build their fabs in the USA, I'm worried about the downsides too. Are my concerns justified?
    - lpetross 6y ago
      Semiconductor plants use a ridiculous amount of potentially harmful chemicals as part of the manufacturing process. Most of the material is recaptured and never makes it into the local environment. Intel uses probably close to 10M gallons of water a DAY and recycles the vast majority. Before water enters a fab it goes through a water purification plant to eliminate any impurities. As the water leaves the fab it goes through another process to decontaminate and recycle it. The process of purifying water is expensive and consumes energy so they try and recycle as much as possible. The number 96% sticks out in my mind but that is an old number. Simply stated, I do not worry about local pollution from semiconductor manufacturing in the United States due to all the regulations. I would live next door to the Chandler plant happily. Pull open Google Maps Satellite View, type in "Intel Chandler Soccer Field" Look at all the green area around the plant, that's where the 4% that isn't recycled goes. You will also see a beautiful golf course and nice houses just east of the plant. Side note: as I understand it, plants moved to AZ/NM because they wanted to eliminate process variance. Weather and water are a major source of variance. So they want places that reduce variance while simultaneously being favorable business environments. Reference: https://ktar.com/story/76977/intel-plant-replenishes-water-supply-in-chandler/ https://ktar.com/story/76977/intel-plant-replenishes-water-s...
- baybal2 6y ago
  > Why are fabs being built in az? If you are asking about Intel ones, and ones owned by the defence hardware industry, it is the same reason why China is building their fabs as far inland as Xian, and other obscure and scattered across places: they are harder to bomb there.
- robotnikman 6y ago
  Other Fabs are already located in the area, and in general the state has been good towards businesses. Also ASU is nearby so they have a talent pool of new engineers to pull from. Anecdote, since I've moved to AZ myself 5 years ago I've noticed massive growth in tech businesses in Phoenix and the surrounding areas. Cost of living for people here is also cheaper compared to to other cities I've lived in, and many people I've met who moved from California have told me how its cheaper here. Commuting is not too bad depending on where you live, and there are options which promote commuting or carpooling such as HOV lanes, Bike Lanes, and the light-rail system (the light rail is hit or miss depending on who you ask).
  - blhack 6y ago
    Greetz from Tempe.
    - robotnikman 6y ago
      And hello from Chandler :)
  - mech422 6y ago
    Mesa Checking In... /wave
    - vyrotek 6y ago
      Hi neighbor
lwneal 6y ago
How much software depends on Apple, AMD, Nvidia, or Qualcomm chips? TSMC is an indispensable part of our industry's supply chain. Most of its chips are produced in Taiwan and over 75% are sold to customers in either the USA or (mainland) China, so TSMC understandably tries to remain neutral in trade disputes between the two. Tim Culpan at Bloomberg recently predicted that this neutrality may not hold for long, and TSMC will be forced to move some production to the USA. [1] Especially if Intel continues to decline, increased investment by TSMC could be good news for American chip fabs and the communities that depend on them. On the other hand, the factory isn't built yet. [1] https://www.bloomberg.com/opinion/articles/2020-05-11/tsmc-must-pick-u-s-in-chips-battle-while-intel-gets-an-opening https://www.bloomberg.com/opinion/articles/2020-05-11/tsmc-m...
- baybal2 6y ago
  > Especially if Intel continues to decline, About Intel... I heard multiple times, from different people that Intel's CEO is frequenting Hsinchu for some, yet unknown, business. It's easy to guess though, there can only be one company there of interest to him.
  - wmf 6y ago
    You don't need to be so oblique. There are plenty of rumors about Xe GPUs being made by TSMC.
- swiley 6y ago
  Literally everyone but the hardware manufacturers would be happier if the software didn't depend on those chips. If we can't move the supply chain closer we should at least decouple software from particular hardware manufacturers.
  - nickff 6y ago
    The capital requirements for the creation of a modern high-speed semiconductor fabrication facility, and the corresponding integrated circuit design make ‘open hardware’, or large number of interchangeable competitors unlikely. How and why should software be decoupled from hardware when there are so few hardware suppliers?
3fe9a03ccd14ca5 6y ago
At least one component of the "America First" strategy I can fully get behind is bringing manufacturing back to the US mainline. If anything that last few months has taught us, it's that we must not lose our ability to produce quality, vital products. Semiconductors definitely falls into that category. I don't care how it's accomplished, either carrots (tax incentives) or sticks (tariffs). Do what's necessary to bring the production of these vital components here.
- pjc50 6y ago
  Taxpayer-funded state-directed economic activity?
  - AnthonyMouse 6y ago
    The problem is, what do you do when the other guy is doing that? It's basically an antitrust violation with a foreign state playing the role of the trust. They can subsidize their industry to sell below cost until yours goes out of business and then have a monopoly. China has been doing this for decades. Not responding is a competitive disadvantage, so it has to be either subsidies or tariffs and sanctions.
  - walterbell 6y ago
    Unlike bank bailouts, we'll have a semiconductor fab, supply chain and jobs to show for it. Put the reserve currency to good use while it's still a reserve currency.
    - adventured 6y ago
      Boosting US domestic manufacturing will help ensure the USD remains the reserve currency. There's zero threat currently to that status and only China is capable of even plausibly posing a challenge in the next ~30 years. The Euro, Yen and Bitcoin pose no realistic challenge to USD dominance. It leaves only the Yuan, which still has no global position at all and isn't regarded as a currency you can trust. China will obviously do anything they can to alter that equation. We're going into, at a minimum, a cold war with China that will last decades. There is no scenario where that is avoided. The US should become wildly aggressive about bringing manufacturing back, or otherwise pushing it out of China (including convincing allies to do the same), pulling every lever necessary.
kaonwarb 6y ago
Has been under discussion for some time: "Mark Liu, the chairman of TSMC, said he had recently discussed options for a new factory in the United States with the Commerce Department. The stumbling block was money; major subsidies would be required, he said, as it is more expensive to operate in America than Taiwan." (https://www.nytimes.com/2019/10/25/technology/pentagon-taiwan-tsmc-chipmaker.html https://www.nytimes.com/2019/10/25/technology/pentagon-taiwa...)
- magicsmoke 6y ago
  What makes up the price differential?
  - jandrese 6y ago
    Having to ship the raw material halfway across the world. More stringent environmental protections--fabs generate many tons of hazardous waste. Higher healthcare costs for the workers. Plus they use lots of water which is more expensive in Arizona.
    - magicsmoke 6y ago
      Considering how the low cost of shipping enabled globalization I doubt the shipping costs matter much. I'm also not sure if environmental protections are that much more stringent in the US than in Taiwan. Higher healthcare costs and water might make sense, but the bulk of the water cost in semiconductor manufacturing is probably due to the purification processes required than the volume of water used.
      - Kirby64 6y ago
        Shipping costs matter some when you go from being right next to the factory that makes your raw silicon wafers to having them be halfway around the world. In general it sounds like a big factor is cost - you've got to get talent that just doesn't exist (or isn't as widely available) in the US.
  - 6y ago
pascoej 6y ago
This is interesting. Right now TSMC seems to provide Taiwan with guaranteed US protection because they are so far ahead technologically. Apple, AMD, and the defense industry have little alternative if they want a cutting edge node. It's unclear how long they will maintain this dominance. Maybe the long term US-Taiwan ties of factories in the US will make this worth it strategically. I assume that all R&D will remain in Taiwan. I think this might still be a good move in the long run since it'll give more politicians stake in what happens to Taiwan (Arizona senators, etc).
- derefr 6y ago
  What does the defense industry need a cutting-edge node for? Better drone battery life?
  - sct202 6y ago
    It won't be as cutting edge by the time it's finished.
  - asdfadsfgfdda 6y ago
    Imagine how much processing power is needed to analyze radar signals or camera images. If you can process more efficiently, your cooling system and electrical generator can be smaller, which saves mass for more fuel or more payload.
    - zozbot234 6y ago
      And they can afford to fund NRE costs that would be grossly uneconomic for most other (niche, non-mass market) applications. There aren't many industry sectors where that is the case.
  - analognoise 6y ago
    Our FPGAs.
  - ngcc_hk 6y ago
    Nvidia just announced its ampere chip Basically a data centre in one rack mount kit. Now the first customer is ... us defend need ai and those Gpu and ai advanced chip all done there.
ChuckMcM 6y ago
This would be an interesting turn of events if it came to pass. It would certainly add good data to the argument that TSMC chips are cheaper because of the economics of east Asia. The geopolitical aspects are, to me at least, a bit over blown. Yes there has been growing concern about the integrity of the supply chain for critical resources, but that is the whole globalization problem in a nutshell. I find the calls to re-vertically-integrate the US to not be very persuasive in terms of practicality. Maybe if Canada and Mexico join the US in an economic union similar to the EU? Chips are just one part of a much larger puzzle and fabs are just one part of a supply chain that includes stops in Malaysia, Indonesia, and Vietnam for packaging and testing. I do think it has been made abundantly clear how interdependent the world is these days. It is possible that the new clarity has caused some powerful forces to reconsider their world view. But has it changed it enough to create real and meaningful policy change? (For context, I see globalization as a means of maximizing profits, not about politics) To my way of thinking, real change would be the ability to economically stand up a 100mm 5nm fab line profitably. That would allow the production of "jelly bean" chips (general purpose < 100M gates). That would be a pretty seismic change in my opinion.
- YinLuck- 6y ago
  >(For context, I see globalization as a means of maximizing profits, not about politics) Globalization is just a euphemism for hegemony. First it was the British Empire, then the American Empire.
  - renw0rp 6y ago
    And now is the Chinese turn?
    - ngcc_hk 6y ago
      To be honest the chinese even study its raise up and have a long tv series about it — war is inevitable. Hence the peaceful raise of china is the slogan. They know you do not. Nearly 20 years of sending in students, researchers, 1000 person scheme etc. They win if it is not Xi, you may not even know until too late.
paulgerhardt 6y ago
I suspect this is the result of DARPA’s big interposer push and it’s leaking now because of the change in leadership there. Specifically TSMC has breakthrough CoWoS interposers, can’t meet demand, and the military is bottlenecked without a chiplet path made in the USA.
- addicted 6y ago
  Something like that seems to make sense considering the investment is relatively tiny and that the factory is gonna be about 1/5th the size of the usual TSMC factory. So it does appear like this is intended for a specific chip for a specific purpose.
person_of_color 6y ago
I hope to see a thousand silicon startups on the West Coast. This is a great time to join Chris Lattner at SiFive.
- ane 6y ago
  He works there now? Cool!
  - person_of_color 6y ago
    You going to apply?
    - 0xFFC 6y ago
      I will if he recruits
ngcc_hk 6y ago
It is time. China invasion may come and in fact hot up so much the guy who responsible for the unlimited war in pla come up to say that is not the right timing. But military invasion is the only choice given Taiwan is going in its political aspiration. (Thanks for the demo of Hong Kong the last election ..) Suicidal is so western thinking. What do you think the North Korea war. What do you think anyone in the Hans mentality afford he has lost Taiwan. Unless the chinese gone multi- ... the oneness cannot he stopped until it controlled. The Middle Kingdom is middle of everything. If they can get in ... or at least ... or a threat like anti-bio. It is just in the us interest. It is time ... it is time ...
gjsman-1000 6y ago
Woah ho ho, the rumors were TRUE!!!
- segfaultbuserr 6y ago
  I was skeptical. But it's official now.
jagger27 6y ago
As someone else mentioned in the other thread, it's a bit odd that they're aiming for 5nm production at this fab in 2024 because 3nm should be ready to go by then. You'd sorta think that since they're already breaking ground on their 3nm fab in Taiwan that any other new builds would be 3nm as well.
- avs733 6y ago
  This sounds a lot like when Intel built fab 68 in China to run no longer bleeding edge processes. This seems like a move designed to mess with Intel's experienced employees and to try and combat potential tarrifs
- Exmoor 6y ago
  I'm not exactly a chip manufacturing expert, but: 1. By the time this fab is in major construction a lot of the lessons learned for 5nm will be known and can more readily be implemented in the USA without splitting precious engineering resources to other countries. 2. 3nm will be the most expensive parts and sell at a premium, which will limit demand. 3. This carries some risk, so giving up the bleeding edge tech might not be the best idea.
kick 6y ago
Well that's the quickest I've ever seen reality prove itself stranger than I could have ever imagined: https://news.ycombinator.com/item?id=23186174 https://news.ycombinator.com/item?id=23186174 I'd be taking bets on how quickly this is going to turn out poorly, but my last tiny ember of faith in any corporate actor being capable of rational thought just got extinguished, so I could be really wrong!
- Teknoman117 6y ago
  why is TSMC building a plant in the US an irrational thought?
  - kick 6y ago
    What's in TSMC's best interest is the long-term independence and stability of Taiwan. Taking away a strong source of motivation for an administration that's already shown itself to lean toward "stay out of other countries; America First!" as its official foreign policy stance to keep it independent and stable is so short-sighted that it's practically insane.
    - remarkEon 6y ago
      Respectfully, I think you're reading this wrong. Long-term independence and stability of Taiwan is a political goal, not necessarily a corporate one. The political-corporate relationship in Taiwan is definitely different (or of a different flavor) than that in the USA right now, which makes this harder to parse for specific corporate objectives. In the aggregate, this could signal a willingness of the government in Taiwan to make bets (assuming they have to approve of things like this, I'm not 100% sure if that's true) that the long term goal (political independence) is best served by further entangling itself with the US. That's probably where the debate should exist.
      - kick 6y ago
        I appreciate the good-natured disagreement! Long-term independence and stability of Taiwan is necessary for TSMC to keep existing. It's in its best interest to keep existing. I'm pretty sure the government doesn't need to approve of this sort of thing; VIA got away with it. Further entangling itself with the US would be keeping itself for the most part in Taiwan. "We have drastically better tech than you, and your military, intelligence agencies & universities really desperately need these!" is a fantastic incentive. "Here's a factory that allows the US to be pretty much self-sufficient and no longer dependent on us for the next few years while you haphazardly try and get on top of the world again" is not nearly as good of an incentive. Taiwan gets invaded yesterday, suddenly the US is in a sticky situation. Taiwan gets invaded when this factory is finished? 5nm vs 2-3nm isn't a huge difference.
DeonPenny 6y ago
Happy to see manufacturing coming back to the US. I'm writing this before I read the comments and have my hopes dashed
salimmadjd 6y ago
part of me is curious if this is a way to appease the administration due to high pressure [0] and wait out the next election cycle. They are talking about 2021-2029. Even if Trump is reelected, I could see them leasing an existing fab and have a ribbon cutting ceremony for Trump to get his photo-op and then just weigh their options with minimal additional expenditure (they've already commented on opening a fab in US won't be economical [1]) with the thinking that a few $million spent on a lease and avoiding antagonizing Trump might all be worthwhile in any kind of tariffs on their business. [0] http://archive.is/XYzCd http://archive.is/XYzCd [1] https://asia.nikkei.com/Business/Technology/TSMC-weighs-new-US-plant-to-respond-to-Trump-pressure https://asia.nikkei.com/Business/Technology/TSMC-weighs-new-... edited my post by adding these articles as well as editing the text to better reference the links
- selimthegrim 6y ago
  The thing is WI is already mad at Foxconn for doing that. AZ is even more of swing state so I don't know if same trick will work twice
- sanxiyn 6y ago
  TSMC found it won't be economical unless subsidized. My understanding is that TSMC managed to get commitment to subsidy from US federal government and the State of Arizona.
Lind5 6y ago
Actually, this is true. The big question is what's going on behind the scenes. China has been busy building up its own supply chain after the U.S. closed off shipments of any U.S.-based R&D to Huawei last summer. It also has made statements that Taiwan is part of China since then, which has left the U.S. without an advanced-node fab. Intel is at least a node behind both Samsung and TSMC, and the U.S. has no trusted foundry on U.S. soil capable of 7nm volume production, let alone 5nm or 3nm. For the U.S., this is a potential disaster. If China marches into Taiwan, the U.S. will be left with no advanced-node manufacturing and it will have lost the technology race. It would take at least four to six years to recover, and by that time China would own the market. This is very scary for the U.S., which needs to develop AI chips at the most advanced nodes because density equals more accelerators and other types of processing elements. Even that isn't enough, which is why companies developing AI chips are stitching together chips that are larger than a single reticle. (https://semiengineering.com/the-risk-of-two-supply-chains/ https://semiengineering.com/the-risk-of-two-supply-chains/) It goes further than that, too. The DoD needs AI chips, too. In the past, the DoD relied on older nodes. That's changed because it needs transistor density for AI. More MACs equals more performance. On top of all of this, TSMC owns the bulk of the fabless market. So this will happen. The big question is who's funding this move.
- magicsmoke 6y ago
  As a bit more context, Huawei recently announced they'll be sending orders for 14nm chips to SMIC's new fab instead of TSMC. 14 nm is about 3 gens behind TSMC's 5nm and was starting to be produced back in 2013.
  - bildung 6y ago
    To add to that, the Kirin 710A that will get produced by SMIC will presumably be very similar to the Kirin 710 from 2018, produced by TSMC with its 16nm/12nm process, so performance-wise this will probably be the same chip but from a different foundry - in mainland China.
- fermienrico 6y ago
  China marching into Taiwan would be a losing move. Never mind the civil unrest, the entire world would bail out of China. Japan, Korea, Vietnam, Malaysia, Singapore and Thailand + India would be even more alerted than they are right now with HK situation. The narrative in these countries is quickly evolving. CCP is over playing their hand by engaging in asymetrical trade.
sremani 6y ago
Welcome to USA. Smart Move TSMC and Taiwan. You have earned a friend for life. For the doubters, this is just the beginning of Re-industrilization of America.
- SlowRobotAhead 6y ago
  I’m not sure which brands TSMC makes for. But I can promise you if there is an option to buy an USA made AMD, I’d pay a premium for that.
  - remarkEon 6y ago
    Same. "Manufactured by TSMC-USA in Arizona". Super exciting to be quite honest.
  - arcticbull 6y ago
    > I’m not sure which brands TSMC makes for. Basically all of them, to some extent. > But I can promise you if there is an option to buy an USA made AMD, I’d pay a premium for that. AMD spun off their own foundry years ago (GlobalFoundaries) and still uses the for some things. FWIW though TSMC already has a US fab, but all their high-end processes are going to remain in Taiwan.
  - rurban 6y ago
    Because you prefer US backdoors over Taiwanese backdoors? Sounds unreasonable to me.
  - megaframe 6y ago
    Qualcomm/Broadcomm/Nvidia/AMD use TSMC AMD does make chips in the US via their spun off Global Foundries, and so does Intel. AMD switched some production to TSMC because they had much better defect rates at 7nm. You can buy US made AMD today if you want it just won't be the latest GPU's.
    - wtallis 6y ago
      > AMD switched some production to TSMC because they had much better defect rates at 7nm. GloFo outright canceled their 7nm and smaller processes, back in 2018. All of AMD's leading-edge processors are now using TSMC 7nm, though the server and most desktop processors also incorporate a 12nm IO die. The days of AMD using GloFo are numbered. Really, though, at this point it's easier to list what leading-edge chips aren't using TSMC: Intel's CPUs and FPGAs. All the other latest-and-greatest CPUs, GPUs, FPGAs and smartphone SoCs are made at TSMC. There's more diversity for memory manufacturing, and logic that doesn't need to be on a leading-edge process (eg. low-end smartphone SoCs, motherboard chipsets, SSD controllers).
ysleepy 6y ago
Right next to the Foxconn plant. /s There is precedent for fabs though, so its not totally out there.
- seldonnn 6y ago
  Yeah Intel has quite a few I hear
  - arcticbull 6y ago
    GlobalFoundaries (ex-AMD) too. And, uh, TSMC.
deleted 6y ago
[deleted]
troughway 6y ago
Bringing back manufacturing and other things of industrial nature from China isn't just good strategic planning in a time of uncertainty. It is also a gesture of good faith because supporting a dictatorship that actively imprisons over a million people in concentration camps and uses them for organ harvesting should, at the very least, be punished economically. There is no finding equal ground or compromise with those bastards.
- deleted 6y ago
  [deleted]
- arcticbull 6y ago
  This isn't being brought back from China, TSMC is Taiwanese and operates the overwhelming majority of their fabs in Taiwan. They have a fab in Shanghai and Nanjing which I believe is both not their leading-edge process and to supply the mainland market. [1] From what I've heard they have no interest in moving their closely guarded leading-edge processes out of Taiwan, and this is probably a domestic fab for supplying the military with on US soil. [1] https://en.wikipedia.org/wiki/TSMC https://en.wikipedia.org/wiki/TSMC
  - harpratap 6y ago
    Yep. This article from nikkei explains this very well - https://asia.nikkei.com/Business/Company-in-focus/Chip-titan-TSMC-caught-in-crossfire-between-US-and-China https://asia.nikkei.com/Business/Company-in-focus/Chip-titan... It's in the best interest of Taiwan to keep their 2nd highest GDP producing industry inside their own country. If a war breaks out between China and US, TSMC factories in Taiwan are going to be the safest place on Earth. No country wants to loose what TSMC has to offer, including Taiwan itself.
- TheSpiceIsLife 6y ago
  Do economic sanctions work alter the behaviour of the targetted government? I was of the understanding the effectiveness of economic sanctions are generally debated, and they tend to have unintended consequences.
throwawaysea 6y ago
I’m excited to see a hedge against China in the form of better foreign relations with others and a revival of domestic manufacturing.
puzzledobserver 6y ago
What is the environmental footprint of a typical fab? From what I understand, modern chips are free of conflict materials, but are there toxic byproducts which would cause trouble with the EPA?
- option 6y ago
  the problem with environment footprint is that moving it to other country solves nothing and often makes matters worse (due to more relaxed standards). We all live on the same planet.
- perl4ever 6y ago
  Modern chips are free of conflict materials? How do you even start to come up with a basis for the statement? I also don't understand the connection between "conflict materials" and toxic substances. I thought it was common knowledge that making chips involves lots of extremely toxic chemicals though.
  - adammunich 6y ago
    The amount of rare elements used to dope semiconductors is orders of magnitude less than what's used in the capacitors next to them.
- megaframe 6y ago
  While still an issue, many of the really bad offenders leaked chemicals for instance doesn't happen much anymore. Mostly because fab materials are expensive to get and purify. Simply dumping them is wasteful, so anything that can be salvaged and used on the next batch is big savings. ... https://blogs.intel.com/csr/files/2019/11/Circularity-at-Intel-Waste-Recovery-and-Reuse-November-2019.pdf https://blogs.intel.com/csr/files/2019/11/Circularity-at-Int...
- 9nGQluzmnq3M 6y ago
  A memorable description of one chemical used in fabs: [Chlorine trifluoride] is apparently about the most vigorous fluorinating agent known, and is much more difficult to handle than fluorine gas. That’s one of those statements you don’t get to hear very often, and it should be enough to make any sensible chemist turn around smartly and head down the hall in the other direction. The compound also a stronger oxidizing agent than oxygen itself, which also puts it into rare territory. That means that it can potentially go on to “burn” things that you would normally consider already burnt to hell and gone, and a practical consequence of that is that it’ll start roaring reactions with things like bricks and asbestos tile. It’s been used in the semiconductor industry to clean oxides off of surfaces, at which activity it no doubt excels. https://blogs.sciencemag.org/pipeline/archives/2008/02/26/sand_wont_save_you_this_time https://blogs.sciencemag.org/pipeline/archives/2008/02/26/sa... Read on to find out what happened when somebody accidentally spilled 1 ton of the stuff!
whalesalad 6y ago
Hopefully this goes better than Foxconn in Wisconsin.
buildbot 6y ago
They already operated design centers and the fab wafertech in Camas, Washington. It’s not wildly surprising, given that all major USA chip players will now be using TSMC, including Intel.
xmly 6y ago
The high paid jobs from Taiwan and Korea are what US wants, not the low pay assemble jobs from China. Good move!
blhack 6y ago
Someday I would really love to buy an iPhone that says "designed and built by Apple in California" Stuff like this is just one step closer to that. I would happily pay a premium for it. Excellent news. And to all of you currently looking at your rent in SF and wondering if you should stay there now that you can work remote: AZ is a pretty awesome place, and more and more it's looking like it actually could become a hardware hub in the US. To be clear on my point about rent in Phoenix, btw: I am currently sitting about 400 yards from ASU (I live across the street from campus). I rented this house for about 10 years for <$1000/mo (2br, 1ba, now I own it), and there are still apartments/condos in this neighborhood for that price. We don't have an ocean, but we have some of the most beautiful hiking in the world, the city is extremely cycle friendly, and almost every biome you could want is a few hours drive max from here. It's really a great city.
- ulfw 6y ago
  Nationalism is a powerful thing huh. I wouldn’t want to buy a ‘Made in CA’ iPhone. How would this be any different to one with chips made in Taiwan? Keep in mind Apple is sold around the world. Not everyone is American.
  - Unklejoe 6y ago
    Because it feels good to support your immediate neighbor?
- TaylorAlexander 6y ago
  Rent in SF is fine! I just live in a one bedroom with 3 people. :-D
  - deleted 6y ago
    [deleted]
  - deleted 6y ago
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- ABeeSea 6y ago
suyash 6y ago
Thanks to President Trump, big win for USA!
- dang 6y ago
  Please don't take HN threads into partisan battle. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- knowaveragejoe 6y ago
  We might've already been here without Trump.
  - h0l0cube 6y ago
    Regardless off any opinions about Trump, the imposition of tarrifs and his incendiary rhetoric seem to be causing manufacturing operations to hedge their bets. So maybe a some higher skill jobs have shifted to the US (not sure if that really helps Trumps voter base), but Tesla smartly started operations in China. Hard to speculate on the counterfactuals, but this increases redundancy, which can add new jobs, but the tarrifs can also rout other parts of the economy - and possibly impact Trump's own voter base more than others.
sparker72678 6y ago
I hope they build it across the street from Intel.
AU_Wow1gle 6y ago
Great move. Bring manufacturing back to US. Decouple everything with China when CCP is in charge of it. CCP is the root of everything evil.
- dang 6y ago
  Using HN for nationalistic flamewar will get you banned here, regardless of which nation you're for or against. Please read https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and use HN in the intended spirit, which is curious conversation.
causality0 6y ago
Is this going to be a repeat of the Foxconn-Wisconsin debacle where the state pays a company four billion dollars to buy a bunch of empty buildings and employ nobody?
- NonEUCitizen 6y ago
  Morris Chang != Terry Gou
  - georgeburdell 6y ago
    Morris retired a few years back
    - MangoCoffee 6y ago
      he left TSMC with a good management and more trust worthy than Foxconn.
mcqueenjordan 6y ago
This is really good news! There are also supply chain opsec implications, esp. given the ... complicated relationship between Taiwan and the PRC.
dang 6y ago
An earlier thread, before the official announcement, was https://news.ycombinator.com/item?id=23183850 https://news.ycombinator.com/item?id=23183850. But we've merged most of the relevant comments into this thread.
- ksec 6y ago
  But now a lot of the comments from old thread are speculating whether the move was right. When the actual news here is the confirmation of the move. I find that a little confusing just reading the comments.
  - dang 6y ago
    People would be posting about that anyway. No discussion colors strictly within the lines of the actual news; it always hops to adjacent questions (which is usually fine) and inevitably to whatever generic themes people associate it with (which is usually not fine: https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20generic%20discussion&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...).
60secz 6y ago
> This facility, which will be built in Arizona, will utilize TSMC’s 5-nanometer technology for semiconductor wafer fabrication Wow Intel can't even get 10 nm working. Big win for Apple and AMD tho.
- harpratap 6y ago
  Isn't Intel's fab always better than TSMC's? Intel 10nm competes with TSMC's 7nm
  - ac29 6y ago
    By the time Intel gets anywhere near the 10nm production volume that TSMC does on 7nm right now, TSMC will probably already be moving to 5nm. Its also difficult to say that "Intel 10nm competes with TSMC's 7nm" because in so many ways, it doesnt. Ice Lake server was supposed to be out this year with a new microarchitechture (the first since Skylake), but still is nowhere to be seen (though it certainly seems likely the big cloud players already have early silicon).
    - MangoCoffee 6y ago
      agree. AMD 4000 mobile chip already win a lot of praises even tho TSMC 7nm supposed to be inferior compare to Intel 10nm. we are talking about 7nm in production right now compare to Intel still struggling with 10nm and squeezing 14nm forever. its a win for TSMC. by the time Intel 10nm is on mass production, TSMC 5nm or even 3nm will be out.
    - wtallis 6y ago
      Intel's 10nm as originally planned would have been superior to TSMC's original 7nm, if Intel's 10nm had actually been functional. But it didn't work and got cancelled and what they're calling 10nm now is what would have been called "10nm+" if they hadn't renamed their entire roadmap to cover up the failure. I'm not sure how close Intel's shipping 10nm comes to TSMC's original 7nm, but that's rapidly becoming irrelevant now that TSMC's 7nm+ with EUV is up and running.
  - 6y ago
shmerl 6y ago
Interesting. Are they planning to use some kind of alternative energy sources for their plants?
duxup 6y ago
I wonder how they are going to make up for the economic reasons this isn't generally done in the US?
chvid 6y ago
I can see some American politicians are celebrating this as a blow to (communist) China. But is this not hurting Taiwan in a major strategic long term way? And risks turning the whole island towards mainland. And for the ones celebrating "Re-industrilization of America". Is the America you envision really a America which does not have anything of importance produced outside America. Even if outside means traditional allies such as Germany, Japan, Taiwan ... ?
- tanilama 6y ago
  Taiwanese people probably wish to not be strategic in a China-US battle. That only means the destruction of that island.
  - chvid 6y ago
    Taiwan is strategic to the US-China battle because it is strategic to China; if Taiwan reunites with China, China will have full access to the Pacific.
- fermienrico 6y ago
  The narrative of American politicians, particularly President Trump, against Europeans has not manifested in the general public, especially in the tech industry. Americans and Europeans work together much in the same way, atleast in my personal experience and exposure to both continents. The tech industry is too smart to be manipulated by politicians.
  - chvid 6y ago
    I can see from the comments that it is being celebrated here.
projektfu 6y ago
Didn’t AMD have a big fab in Arizona once?
baybal2 6y ago
This surreal, and this is a bombshell. TSMC is to build a second 5nm plant outside of their strategic roadmap, and has to get money for it out of the blue. How will it work out with their investors, only god knows. And this has ultimately to pass by Taiwanese government, if it didn't already.
- deleted 6y ago
  [deleted]
lacker 6y ago
It would make a lot more sense than UBI if the US would chip in part of the salary, ie (cost of American worker - cost of Taiwanese worker), so that this sort of factory would no longer be disincentivized just because of the cost of American labor.
- beefalo 6y ago
  This effectively happens already by the massive property tax incentives for factories.
andy_ppp 6y ago
I think Europe would do well to thing about getting TSMC to build a fab in Europe, especially as a lot of the tools are already built here. Good to see the American government still functions in one way or another...
Nokinside 6y ago
Important detail: This is not GIGAFAB facility. Only 20,000 wafers per month is between mini- and megafab for TSMC. I suspect the production goes to US defense applications. Pompeo tweeting about it seems to confirm it. https://twitter.com/SecPompeo/status/1261143980634509318 https://twitter.com/SecPompeo/status/1261143980634509318? >Secretary Pompeo >@SecPompeo >The U.S. welcomes TSMC’s intention to invest $12B in the most advanced 5-nanometer semiconductor fabrication foundry in the world. This deal bolsters U.S. national security at a time when China is trying to dominate cutting-edge tech and control critical industries.
- xxs 6y ago
  Seems like the most of the discussion here totally missed that part - that would be no consumer grade chips and likely the prime client would be US military. 20k wafers (perhaps 450mm ones?) with unknown yield (likely 80ish) is quite low. For reference AMD 5700 has die area of ~250mm.
  - Nokinside 6y ago
    I don't see how that big investment for relative low volume production would make sense for consumer products. If the fab is located inside the US, AMD and NVIDIA can bid for many US government contracts that would go for Intel. After GlobalFoundries quit the race, US defense contractors have only Intel as supplier for many components.
    - esmi 6y ago
      > I don't see how that big investment for relative low volume production would make sense for consumer products. If the consumer product is a toy then sure. If it’s a medical device then it could make sense. It’s all about margin. > After GlobalFoundries quit the race, US defense contractors have only Intel as supplier for many components. Maybe. If you want millions of chips a quarter then sure. But if you want 1000s a quarter then there are many options, depending on the node I guess. I’m not going to Google a complete list but one obvious example is Texas Instruments.
Denvercoder9 6y ago
Excuse the naive question, but what technology does a fab bring to the table? As I understand it, TSMC buys most (all?) of their equipment from ASML (or a competitor), and the chip design is done and owned by their customers. What's left, aside from a giant cleanroom and some specialized operators?
- ridewinter 6y ago
  Good question. There there must be something material otherwise TSMC wouldn't have such a lead on their competitors.
microcolonel 6y ago
Next we need a proper embassy. No more erasure of the true Chinese Republic with actual human rights, freedom, and prosperity for the many and not the connected few of the few.
helsinkiandrew 6y ago
I thought there was an interesting point in this economist article: https://www.economist.com/business/2020/05/21/americas-latest-salvo-against-huawei-is-aimed-at-chipmaking-in-china https://www.economist.com/business/2020/05/21/americas-lates... "tsmc could equip the Arizona foundry with American gear from its existing factories, freeing space in its Taiwanese operations for brand new non-American kit that can freely serve Chinese customers"

540 points by ytch 6y ago

lawrenceyan 6y ago

Some competition with Intel in their home turf I see.

bob1029 6y ago
This is an excellent strategy if you want to decimate the talent pool of your competitors and simultaneously ramp production without having to build local staff from zero. With some aggressive incentives, they could probably snipe a lot of talent from across town. Worst case, they will just fly in hundreds of existing, trained employees from Taiwan until the local workforce is stabilized. This is how Samsung bootstrapped their ATX factory.

ccmcarey 6y ago

Only a few days ago they were saying they had no specific plans for a US fab (https://www.digitimes.com/news/a20200512PD202.html https://www.digitimes.com/news/a20200512PD202.html). Nice that Intel will have more local competition.

rough-sea 6y ago

Why are fabs being built in az?

kyrra 6y ago
Guesses: away from fault lines? Dry climate? They get some nasty rains that flood things, but better than tornados, hurricanes, and earthquakes.
- throwawaybanjo1 6y ago
  ^ This. Also explains why there's so many data centers. Cost too. Land & power are both cheap.
  - madengr 6y ago
    I'm sure evaporative cooling is cheaper too, compared to some place where it's too humid.
magicsmoke 6y ago
ASU puts out some pretty talented semiconductor engineers, and ON Semiconductor is a major supplier based in Phoenix
- 0xDEADBEF 6y ago
  ASU isn't exactly a premier college for engineering. They have good parties tho
  - magicsmoke 6y ago
    Maybe not for undergrad, but undergraduates don't learn how to do semiconductor manufacturing.
- 3fe9a03ccd14ca5 6y ago
  And there’s existing talent because Intel has chip fabs there.
antishatter 6y ago
Intel has a big AZ presence, I wonder why AZ specifically. Maybe climate? Maybe so TSMC can poach some talent? It's a really great question and if anyone has specifics I hope they chime in.
- elihu 6y ago
  Probably also a pretty good existing ecosystem of 3rd party contractors and suppliers that support the Intel fabs and would be happy to do business with TSMC as well. edit: also, a minor quibble: I wish we'd get away from calling it "poaching", as if there is anything illegal or immoral about employers competing for employees.
clumsysmurf 6y ago
Business friendly state that has low oversight into what goes into our environment. We have an EPA superfund site near an old Motorola plant.
- khuey 6y ago
  Santa Clara County is full of Superfund sites from old semiconductor factories so there's nothing new there.
lpetross 6y ago
AZ has been a semiconductor hub for decades. Intel, Motorola, ON and many others produce chips there. There is huge infrastructure and talent base for semiconductor manufacturing. Geographically, Chandler as a suburb of Phoenix has consistent weather, relatively cheap land, and access to water - as counter-intuitive as it sounds. I did my PhD in semiconductors at ASU and there might has well been a bus direct from the University to Intel. Keep in mind, we're talking about PRODUCTION, not R&D. R&D happens elsewhere, this is just where the big plants go.
- specialist 6y ago
  Thank you for providing context. During the 80s & 90s, one of my besties worked on building fabs in and around PHX. Really exotic stuff that I didn't really understand. He'd joke that he had a PhD in welding. He claimed at the time that fabs were migrating from California to PHX and ABX to avoid environmental regulation (enforcement) and cheaper water. While he was concerned about building future superfund sites, he also knew he'd never make that kind of money doing any other kind of work. If you don't mind, I'd really appreciate your take. I still have family in Phoenix. I've always been concerned about toxins (air and water). And I'm also grumpy about megacorps guzzling all the water at discount prices. So while I'd love for TSMC to build their fabs in the USA, I'm worried about the downsides too. Are my concerns justified?
  - lpetross 6y ago
    Semiconductor plants use a ridiculous amount of potentially harmful chemicals as part of the manufacturing process. Most of the material is recaptured and never makes it into the local environment. Intel uses probably close to 10M gallons of water a DAY and recycles the vast majority. Before water enters a fab it goes through a water purification plant to eliminate any impurities. As the water leaves the fab it goes through another process to decontaminate and recycle it. The process of purifying water is expensive and consumes energy so they try and recycle as much as possible. The number 96% sticks out in my mind but that is an old number. Simply stated, I do not worry about local pollution from semiconductor manufacturing in the United States due to all the regulations. I would live next door to the Chandler plant happily. Pull open Google Maps Satellite View, type in "Intel Chandler Soccer Field" Look at all the green area around the plant, that's where the 4% that isn't recycled goes. You will also see a beautiful golf course and nice houses just east of the plant. Side note: as I understand it, plants moved to AZ/NM because they wanted to eliminate process variance. Weather and water are a major source of variance. So they want places that reduce variance while simultaneously being favorable business environments. Reference: https://ktar.com/story/76977/intel-plant-replenishes-water-supply-in-chandler/ https://ktar.com/story/76977/intel-plant-replenishes-water-s...
baybal2 6y ago
> Why are fabs being built in az? If you are asking about Intel ones, and ones owned by the defence hardware industry, it is the same reason why China is building their fabs as far inland as Xian, and other obscure and scattered across places: they are harder to bomb there.
robotnikman 6y ago
Other Fabs are already located in the area, and in general the state has been good towards businesses. Also ASU is nearby so they have a talent pool of new engineers to pull from. Anecdote, since I've moved to AZ myself 5 years ago I've noticed massive growth in tech businesses in Phoenix and the surrounding areas. Cost of living for people here is also cheaper compared to to other cities I've lived in, and many people I've met who moved from California have told me how its cheaper here. Commuting is not too bad depending on where you live, and there are options which promote commuting or carpooling such as HOV lanes, Bike Lanes, and the light-rail system (the light rail is hit or miss depending on who you ask).
- blhack 6y ago
  Greetz from Tempe.
  - robotnikman 6y ago
    And hello from Chandler :)
- mech422 6y ago
  Mesa Checking In... /wave
  - vyrotek 6y ago
    Hi neighbor

lwneal 6y ago

How much software depends on Apple, AMD, Nvidia, or Qualcomm chips? TSMC is an indispensable part of our industry's supply chain. Most of its chips are produced in Taiwan and over 75% are sold to customers in either the USA or (mainland) China, so TSMC understandably tries to remain neutral in trade disputes between the two. Tim Culpan at Bloomberg recently predicted that this neutrality may not hold for long, and TSMC will be forced to move some production to the USA. [1] Especially if Intel continues to decline, increased investment by TSMC could be good news for American chip fabs and the communities that depend on them. On the other hand, the factory isn't built yet. [1] https://www.bloomberg.com/opinion/articles/2020-05-11/tsmc-must-pick-u-s-in-chips-battle-while-intel-gets-an-opening https://www.bloomberg.com/opinion/articles/2020-05-11/tsmc-m...

baybal2 6y ago
> Especially if Intel continues to decline, About Intel... I heard multiple times, from different people that Intel's CEO is frequenting Hsinchu for some, yet unknown, business. It's easy to guess though, there can only be one company there of interest to him.
- wmf 6y ago
  You don't need to be so oblique. There are plenty of rumors about Xe GPUs being made by TSMC.
swiley 6y ago
Literally everyone but the hardware manufacturers would be happier if the software didn't depend on those chips. If we can't move the supply chain closer we should at least decouple software from particular hardware manufacturers.
- nickff 6y ago
  The capital requirements for the creation of a modern high-speed semiconductor fabrication facility, and the corresponding integrated circuit design make ‘open hardware’, or large number of interchangeable competitors unlikely. How and why should software be decoupled from hardware when there are so few hardware suppliers?

3fe9a03ccd14ca5 6y ago

At least one component of the "America First" strategy I can fully get behind is bringing manufacturing back to the US mainline. If anything that last few months has taught us, it's that we must not lose our ability to produce quality, vital products. Semiconductors definitely falls into that category. I don't care how it's accomplished, either carrots (tax incentives) or sticks (tariffs). Do what's necessary to bring the production of these vital components here.

pjc50 6y ago
Taxpayer-funded state-directed economic activity?
- AnthonyMouse 6y ago
  The problem is, what do you do when the other guy is doing that? It's basically an antitrust violation with a foreign state playing the role of the trust. They can subsidize their industry to sell below cost until yours goes out of business and then have a monopoly. China has been doing this for decades. Not responding is a competitive disadvantage, so it has to be either subsidies or tariffs and sanctions.
- walterbell 6y ago
  Unlike bank bailouts, we'll have a semiconductor fab, supply chain and jobs to show for it. Put the reserve currency to good use while it's still a reserve currency.
  - adventured 6y ago
    Boosting US domestic manufacturing will help ensure the USD remains the reserve currency. There's zero threat currently to that status and only China is capable of even plausibly posing a challenge in the next ~30 years. The Euro, Yen and Bitcoin pose no realistic challenge to USD dominance. It leaves only the Yuan, which still has no global position at all and isn't regarded as a currency you can trust. China will obviously do anything they can to alter that equation. We're going into, at a minimum, a cold war with China that will last decades. There is no scenario where that is avoided. The US should become wildly aggressive about bringing manufacturing back, or otherwise pushing it out of China (including convincing allies to do the same), pulling every lever necessary.

kaonwarb 6y ago

Has been under discussion for some time: "Mark Liu, the chairman of TSMC, said he had recently discussed options for a new factory in the United States with the Commerce Department. The stumbling block was money; major subsidies would be required, he said, as it is more expensive to operate in America than Taiwan." (https://www.nytimes.com/2019/10/25/technology/pentagon-taiwan-tsmc-chipmaker.html https://www.nytimes.com/2019/10/25/technology/pentagon-taiwa...)

magicsmoke 6y ago
What makes up the price differential?
- jandrese 6y ago
  Having to ship the raw material halfway across the world. More stringent environmental protections--fabs generate many tons of hazardous waste. Higher healthcare costs for the workers. Plus they use lots of water which is more expensive in Arizona.
  - magicsmoke 6y ago
    Considering how the low cost of shipping enabled globalization I doubt the shipping costs matter much. I'm also not sure if environmental protections are that much more stringent in the US than in Taiwan. Higher healthcare costs and water might make sense, but the bulk of the water cost in semiconductor manufacturing is probably due to the purification processes required than the volume of water used.
    - Kirby64 6y ago
      Shipping costs matter some when you go from being right next to the factory that makes your raw silicon wafers to having them be halfway around the world. In general it sounds like a big factor is cost - you've got to get talent that just doesn't exist (or isn't as widely available) in the US.
- 6y ago

pascoej 6y ago

This is interesting. Right now TSMC seems to provide Taiwan with guaranteed US protection because they are so far ahead technologically. Apple, AMD, and the defense industry have little alternative if they want a cutting edge node. It's unclear how long they will maintain this dominance. Maybe the long term US-Taiwan ties of factories in the US will make this worth it strategically. I assume that all R&D will remain in Taiwan. I think this might still be a good move in the long run since it'll give more politicians stake in what happens to Taiwan (Arizona senators, etc).

derefr 6y ago
What does the defense industry need a cutting-edge node for? Better drone battery life?
- sct202 6y ago
  It won't be as cutting edge by the time it's finished.
- asdfadsfgfdda 6y ago
  Imagine how much processing power is needed to analyze radar signals or camera images. If you can process more efficiently, your cooling system and electrical generator can be smaller, which saves mass for more fuel or more payload.
  - zozbot234 6y ago
    And they can afford to fund NRE costs that would be grossly uneconomic for most other (niche, non-mass market) applications. There aren't many industry sectors where that is the case.
- analognoise 6y ago
  Our FPGAs.
- ngcc_hk 6y ago
  Nvidia just announced its ampere chip Basically a data centre in one rack mount kit. Now the first customer is ... us defend need ai and those Gpu and ai advanced chip all done there.

ChuckMcM 6y ago

This would be an interesting turn of events if it came to pass. It would certainly add good data to the argument that TSMC chips are cheaper because of the economics of east Asia. The geopolitical aspects are, to me at least, a bit over blown. Yes there has been growing concern about the integrity of the supply chain for critical resources, but that is the whole globalization problem in a nutshell. I find the calls to re-vertically-integrate the US to not be very persuasive in terms of practicality. Maybe if Canada and Mexico join the US in an economic union similar to the EU? Chips are just one part of a much larger puzzle and fabs are just one part of a supply chain that includes stops in Malaysia, Indonesia, and Vietnam for packaging and testing. I do think it has been made abundantly clear how interdependent the world is these days. It is possible that the new clarity has caused some powerful forces to reconsider their world view. But has it changed it enough to create real and meaningful policy change? (For context, I see globalization as a means of maximizing profits, not about politics) To my way of thinking, real change would be the ability to economically stand up a 100mm 5nm fab line profitably. That would allow the production of "jelly bean" chips (general purpose < 100M gates). That would be a pretty seismic change in my opinion.

YinLuck- 6y ago
>(For context, I see globalization as a means of maximizing profits, not about politics) Globalization is just a euphemism for hegemony. First it was the British Empire, then the American Empire.
- renw0rp 6y ago
  And now is the Chinese turn?
  - ngcc_hk 6y ago
    To be honest the chinese even study its raise up and have a long tv series about it — war is inevitable. Hence the peaceful raise of china is the slogan. They know you do not. Nearly 20 years of sending in students, researchers, 1000 person scheme etc. They win if it is not Xi, you may not even know until too late.

paulgerhardt 6y ago

I suspect this is the result of DARPA’s big interposer push and it’s leaking now because of the change in leadership there. Specifically TSMC has breakthrough CoWoS interposers, can’t meet demand, and the military is bottlenecked without a chiplet path made in the USA.

addicted 6y ago
Something like that seems to make sense considering the investment is relatively tiny and that the factory is gonna be about 1/5th the size of the usual TSMC factory. So it does appear like this is intended for a specific chip for a specific purpose.

person_of_color 6y ago

I hope to see a thousand silicon startups on the West Coast. This is a great time to join Chris Lattner at SiFive.

ane 6y ago
He works there now? Cool!
- person_of_color 6y ago
  You going to apply?
  - 0xFFC 6y ago
    I will if he recruits

ngcc_hk 6y ago

It is time. China invasion may come and in fact hot up so much the guy who responsible for the unlimited war in pla come up to say that is not the right timing. But military invasion is the only choice given Taiwan is going in its political aspiration. (Thanks for the demo of Hong Kong the last election ..) Suicidal is so western thinking. What do you think the North Korea war. What do you think anyone in the Hans mentality afford he has lost Taiwan. Unless the chinese gone multi- ... the oneness cannot he stopped until it controlled. The Middle Kingdom is middle of everything. If they can get in ... or at least ... or a threat like anti-bio. It is just in the us interest. It is time ... it is time ...

gjsman-1000 6y ago

Woah ho ho, the rumors were TRUE!!!

segfaultbuserr 6y ago
I was skeptical. But it's official now.

jagger27 6y ago

As someone else mentioned in the other thread, it's a bit odd that they're aiming for 5nm production at this fab in 2024 because 3nm should be ready to go by then. You'd sorta think that since they're already breaking ground on their 3nm fab in Taiwan that any other new builds would be 3nm as well.

avs733 6y ago
This sounds a lot like when Intel built fab 68 in China to run no longer bleeding edge processes. This seems like a move designed to mess with Intel's experienced employees and to try and combat potential tarrifs
Exmoor 6y ago
I'm not exactly a chip manufacturing expert, but: 1. By the time this fab is in major construction a lot of the lessons learned for 5nm will be known and can more readily be implemented in the USA without splitting precious engineering resources to other countries. 2. 3nm will be the most expensive parts and sell at a premium, which will limit demand. 3. This carries some risk, so giving up the bleeding edge tech might not be the best idea.

kick 6y ago

Well that's the quickest I've ever seen reality prove itself stranger than I could have ever imagined: https://news.ycombinator.com/item?id=23186174 https://news.ycombinator.com/item?id=23186174 I'd be taking bets on how quickly this is going to turn out poorly, but my last tiny ember of faith in any corporate actor being capable of rational thought just got extinguished, so I could be really wrong!

Teknoman117 6y ago
why is TSMC building a plant in the US an irrational thought?
- kick 6y ago
  What's in TSMC's best interest is the long-term independence and stability of Taiwan. Taking away a strong source of motivation for an administration that's already shown itself to lean toward "stay out of other countries; America First!" as its official foreign policy stance to keep it independent and stable is so short-sighted that it's practically insane.
  - remarkEon 6y ago
    Respectfully, I think you're reading this wrong. Long-term independence and stability of Taiwan is a political goal, not necessarily a corporate one. The political-corporate relationship in Taiwan is definitely different (or of a different flavor) than that in the USA right now, which makes this harder to parse for specific corporate objectives. In the aggregate, this could signal a willingness of the government in Taiwan to make bets (assuming they have to approve of things like this, I'm not 100% sure if that's true) that the long term goal (political independence) is best served by further entangling itself with the US. That's probably where the debate should exist.
    - kick 6y ago
      I appreciate the good-natured disagreement! Long-term independence and stability of Taiwan is necessary for TSMC to keep existing. It's in its best interest to keep existing. I'm pretty sure the government doesn't need to approve of this sort of thing; VIA got away with it. Further entangling itself with the US would be keeping itself for the most part in Taiwan. "We have drastically better tech than you, and your military, intelligence agencies & universities really desperately need these!" is a fantastic incentive. "Here's a factory that allows the US to be pretty much self-sufficient and no longer dependent on us for the next few years while you haphazardly try and get on top of the world again" is not nearly as good of an incentive. Taiwan gets invaded yesterday, suddenly the US is in a sticky situation. Taiwan gets invaded when this factory is finished? 5nm vs 2-3nm isn't a huge difference.

DeonPenny 6y ago

Happy to see manufacturing coming back to the US. I'm writing this before I read the comments and have my hopes dashed

salimmadjd 6y ago

part of me is curious if this is a way to appease the administration due to high pressure [0] and wait out the next election cycle. They are talking about 2021-2029. Even if Trump is reelected, I could see them leasing an existing fab and have a ribbon cutting ceremony for Trump to get his photo-op and then just weigh their options with minimal additional expenditure (they've already commented on opening a fab in US won't be economical [1]) with the thinking that a few $million spent on a lease and avoiding antagonizing Trump might all be worthwhile in any kind of tariffs on their business. [0] http://archive.is/XYzCd http://archive.is/XYzCd [1] https://asia.nikkei.com/Business/Technology/TSMC-weighs-new-US-plant-to-respond-to-Trump-pressure https://asia.nikkei.com/Business/Technology/TSMC-weighs-new-... edited my post by adding these articles as well as editing the text to better reference the links

selimthegrim 6y ago
The thing is WI is already mad at Foxconn for doing that. AZ is even more of swing state so I don't know if same trick will work twice
sanxiyn 6y ago
TSMC found it won't be economical unless subsidized. My understanding is that TSMC managed to get commitment to subsidy from US federal government and the State of Arizona.

Lind5 6y ago

Actually, this is true. The big question is what's going on behind the scenes. China has been busy building up its own supply chain after the U.S. closed off shipments of any U.S.-based R&D to Huawei last summer. It also has made statements that Taiwan is part of China since then, which has left the U.S. without an advanced-node fab. Intel is at least a node behind both Samsung and TSMC, and the U.S. has no trusted foundry on U.S. soil capable of 7nm volume production, let alone 5nm or 3nm. For the U.S., this is a potential disaster. If China marches into Taiwan, the U.S. will be left with no advanced-node manufacturing and it will have lost the technology race. It would take at least four to six years to recover, and by that time China would own the market. This is very scary for the U.S., which needs to develop AI chips at the most advanced nodes because density equals more accelerators and other types of processing elements. Even that isn't enough, which is why companies developing AI chips are stitching together chips that are larger than a single reticle. (https://semiengineering.com/the-risk-of-two-supply-chains/ https://semiengineering.com/the-risk-of-two-supply-chains/) It goes further than that, too. The DoD needs AI chips, too. In the past, the DoD relied on older nodes. That's changed because it needs transistor density for AI. More MACs equals more performance. On top of all of this, TSMC owns the bulk of the fabless market. So this will happen. The big question is who's funding this move.

magicsmoke 6y ago
As a bit more context, Huawei recently announced they'll be sending orders for 14nm chips to SMIC's new fab instead of TSMC. 14 nm is about 3 gens behind TSMC's 5nm and was starting to be produced back in 2013.
- bildung 6y ago
  To add to that, the Kirin 710A that will get produced by SMIC will presumably be very similar to the Kirin 710 from 2018, produced by TSMC with its 16nm/12nm process, so performance-wise this will probably be the same chip but from a different foundry - in mainland China.
fermienrico 6y ago
China marching into Taiwan would be a losing move. Never mind the civil unrest, the entire world would bail out of China. Japan, Korea, Vietnam, Malaysia, Singapore and Thailand + India would be even more alerted than they are right now with HK situation. The narrative in these countries is quickly evolving. CCP is over playing their hand by engaging in asymetrical trade.

sremani 6y ago

Welcome to USA. Smart Move TSMC and Taiwan. You have earned a friend for life. For the doubters, this is just the beginning of Re-industrilization of America.

SlowRobotAhead 6y ago
I’m not sure which brands TSMC makes for. But I can promise you if there is an option to buy an USA made AMD, I’d pay a premium for that.
- remarkEon 6y ago
  Same. "Manufactured by TSMC-USA in Arizona". Super exciting to be quite honest.
- arcticbull 6y ago
  > I’m not sure which brands TSMC makes for. Basically all of them, to some extent. > But I can promise you if there is an option to buy an USA made AMD, I’d pay a premium for that. AMD spun off their own foundry years ago (GlobalFoundaries) and still uses the for some things. FWIW though TSMC already has a US fab, but all their high-end processes are going to remain in Taiwan.
- rurban 6y ago
  Because you prefer US backdoors over Taiwanese backdoors? Sounds unreasonable to me.
- megaframe 6y ago
  Qualcomm/Broadcomm/Nvidia/AMD use TSMC AMD does make chips in the US via their spun off Global Foundries, and so does Intel. AMD switched some production to TSMC because they had much better defect rates at 7nm. You can buy US made AMD today if you want it just won't be the latest GPU's.
  - wtallis 6y ago
    > AMD switched some production to TSMC because they had much better defect rates at 7nm. GloFo outright canceled their 7nm and smaller processes, back in 2018. All of AMD's leading-edge processors are now using TSMC 7nm, though the server and most desktop processors also incorporate a 12nm IO die. The days of AMD using GloFo are numbered. Really, though, at this point it's easier to list what leading-edge chips aren't using TSMC: Intel's CPUs and FPGAs. All the other latest-and-greatest CPUs, GPUs, FPGAs and smartphone SoCs are made at TSMC. There's more diversity for memory manufacturing, and logic that doesn't need to be on a leading-edge process (eg. low-end smartphone SoCs, motherboard chipsets, SSD controllers).

ysleepy 6y ago

Right next to the Foxconn plant. /s There is precedent for fabs though, so its not totally out there.

seldonnn 6y ago
Yeah Intel has quite a few I hear
- arcticbull 6y ago
  GlobalFoundaries (ex-AMD) too. And, uh, TSMC.

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troughway 6y ago

Bringing back manufacturing and other things of industrial nature from China isn't just good strategic planning in a time of uncertainty. It is also a gesture of good faith because supporting a dictatorship that actively imprisons over a million people in concentration camps and uses them for organ harvesting should, at the very least, be punished economically. There is no finding equal ground or compromise with those bastards.

deleted 6y ago
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arcticbull 6y ago
This isn't being brought back from China, TSMC is Taiwanese and operates the overwhelming majority of their fabs in Taiwan. They have a fab in Shanghai and Nanjing which I believe is both not their leading-edge process and to supply the mainland market. [1] From what I've heard they have no interest in moving their closely guarded leading-edge processes out of Taiwan, and this is probably a domestic fab for supplying the military with on US soil. [1] https://en.wikipedia.org/wiki/TSMC https://en.wikipedia.org/wiki/TSMC
- harpratap 6y ago
  Yep. This article from nikkei explains this very well - https://asia.nikkei.com/Business/Company-in-focus/Chip-titan-TSMC-caught-in-crossfire-between-US-and-China https://asia.nikkei.com/Business/Company-in-focus/Chip-titan... It's in the best interest of Taiwan to keep their 2nd highest GDP producing industry inside their own country. If a war breaks out between China and US, TSMC factories in Taiwan are going to be the safest place on Earth. No country wants to loose what TSMC has to offer, including Taiwan itself.
TheSpiceIsLife 6y ago
Do economic sanctions work alter the behaviour of the targetted government? I was of the understanding the effectiveness of economic sanctions are generally debated, and they tend to have unintended consequences.

throwawaysea 6y ago

I’m excited to see a hedge against China in the form of better foreign relations with others and a revival of domestic manufacturing.

puzzledobserver 6y ago

What is the environmental footprint of a typical fab? From what I understand, modern chips are free of conflict materials, but are there toxic byproducts which would cause trouble with the EPA?

option 6y ago
the problem with environment footprint is that moving it to other country solves nothing and often makes matters worse (due to more relaxed standards). We all live on the same planet.
perl4ever 6y ago
Modern chips are free of conflict materials? How do you even start to come up with a basis for the statement? I also don't understand the connection between "conflict materials" and toxic substances. I thought it was common knowledge that making chips involves lots of extremely toxic chemicals though.
- adammunich 6y ago
  The amount of rare elements used to dope semiconductors is orders of magnitude less than what's used in the capacitors next to them.
megaframe 6y ago
While still an issue, many of the really bad offenders leaked chemicals for instance doesn't happen much anymore. Mostly because fab materials are expensive to get and purify. Simply dumping them is wasteful, so anything that can be salvaged and used on the next batch is big savings. ... https://blogs.intel.com/csr/files/2019/11/Circularity-at-Intel-Waste-Recovery-and-Reuse-November-2019.pdf https://blogs.intel.com/csr/files/2019/11/Circularity-at-Int...
9nGQluzmnq3M 6y ago
A memorable description of one chemical used in fabs: [Chlorine trifluoride] is apparently about the most vigorous fluorinating agent known, and is much more difficult to handle than fluorine gas. That’s one of those statements you don’t get to hear very often, and it should be enough to make any sensible chemist turn around smartly and head down the hall in the other direction. The compound also a stronger oxidizing agent than oxygen itself, which also puts it into rare territory. That means that it can potentially go on to “burn” things that you would normally consider already burnt to hell and gone, and a practical consequence of that is that it’ll start roaring reactions with things like bricks and asbestos tile. It’s been used in the semiconductor industry to clean oxides off of surfaces, at which activity it no doubt excels. https://blogs.sciencemag.org/pipeline/archives/2008/02/26/sand_wont_save_you_this_time https://blogs.sciencemag.org/pipeline/archives/2008/02/26/sa... Read on to find out what happened when somebody accidentally spilled 1 ton of the stuff!

whalesalad 6y ago

Hopefully this goes better than Foxconn in Wisconsin.

buildbot 6y ago

They already operated design centers and the fab wafertech in Camas, Washington. It’s not wildly surprising, given that all major USA chip players will now be using TSMC, including Intel.

xmly 6y ago

The high paid jobs from Taiwan and Korea are what US wants, not the low pay assemble jobs from China. Good move!

blhack 6y ago

Someday I would really love to buy an iPhone that says "designed and built by Apple in California" Stuff like this is just one step closer to that. I would happily pay a premium for it. Excellent news. And to all of you currently looking at your rent in SF and wondering if you should stay there now that you can work remote: AZ is a pretty awesome place, and more and more it's looking like it actually could become a hardware hub in the US. To be clear on my point about rent in Phoenix, btw: I am currently sitting about 400 yards from ASU (I live across the street from campus). I rented this house for about 10 years for <$1000/mo (2br, 1ba, now I own it), and there are still apartments/condos in this neighborhood for that price. We don't have an ocean, but we have some of the most beautiful hiking in the world, the city is extremely cycle friendly, and almost every biome you could want is a few hours drive max from here. It's really a great city.

ulfw 6y ago
Nationalism is a powerful thing huh. I wouldn’t want to buy a ‘Made in CA’ iPhone. How would this be any different to one with chips made in Taiwan? Keep in mind Apple is sold around the world. Not everyone is American.
- Unklejoe 6y ago
  Because it feels good to support your immediate neighbor?
TaylorAlexander 6y ago
Rent in SF is fine! I just live in a one bedroom with 3 people. :-D
- deleted 6y ago
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ABeeSea 6y ago

suyash 6y ago

Thanks to President Trump, big win for USA!

dang 6y ago
Please don't take HN threads into partisan battle. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
knowaveragejoe 6y ago
We might've already been here without Trump.
- h0l0cube 6y ago
  Regardless off any opinions about Trump, the imposition of tarrifs and his incendiary rhetoric seem to be causing manufacturing operations to hedge their bets. So maybe a some higher skill jobs have shifted to the US (not sure if that really helps Trumps voter base), but Tesla smartly started operations in China. Hard to speculate on the counterfactuals, but this increases redundancy, which can add new jobs, but the tarrifs can also rout other parts of the economy - and possibly impact Trump's own voter base more than others.

sparker72678 6y ago

I hope they build it across the street from Intel.

AU_Wow1gle 6y ago

Great move. Bring manufacturing back to US. Decouple everything with China when CCP is in charge of it. CCP is the root of everything evil.

dang 6y ago
Using HN for nationalistic flamewar will get you banned here, regardless of which nation you're for or against. Please read https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and use HN in the intended spirit, which is curious conversation.

causality0 6y ago

Is this going to be a repeat of the Foxconn-Wisconsin debacle where the state pays a company four billion dollars to buy a bunch of empty buildings and employ nobody?

NonEUCitizen 6y ago
Morris Chang != Terry Gou
- georgeburdell 6y ago
  Morris retired a few years back
  - MangoCoffee 6y ago
    he left TSMC with a good management and more trust worthy than Foxconn.

mcqueenjordan 6y ago

This is really good news! There are also supply chain opsec implications, esp. given the ... complicated relationship between Taiwan and the PRC.

dang 6y ago

An earlier thread, before the official announcement, was https://news.ycombinator.com/item?id=23183850 https://news.ycombinator.com/item?id=23183850. But we've merged most of the relevant comments into this thread.

ksec 6y ago
But now a lot of the comments from old thread are speculating whether the move was right. When the actual news here is the confirmation of the move. I find that a little confusing just reading the comments.
- dang 6y ago
  People would be posting about that anyway. No discussion colors strictly within the lines of the actual news; it always hops to adjacent questions (which is usually fine) and inevitably to whatever generic themes people associate it with (which is usually not fine: https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20generic%20discussion&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...).

60secz 6y ago

> This facility, which will be built in Arizona, will utilize TSMC’s 5-nanometer technology for semiconductor wafer fabrication Wow Intel can't even get 10 nm working. Big win for Apple and AMD tho.

harpratap 6y ago
Isn't Intel's fab always better than TSMC's? Intel 10nm competes with TSMC's 7nm
- ac29 6y ago
  By the time Intel gets anywhere near the 10nm production volume that TSMC does on 7nm right now, TSMC will probably already be moving to 5nm. Its also difficult to say that "Intel 10nm competes with TSMC's 7nm" because in so many ways, it doesnt. Ice Lake server was supposed to be out this year with a new microarchitechture (the first since Skylake), but still is nowhere to be seen (though it certainly seems likely the big cloud players already have early silicon).
  - MangoCoffee 6y ago
    agree. AMD 4000 mobile chip already win a lot of praises even tho TSMC 7nm supposed to be inferior compare to Intel 10nm. we are talking about 7nm in production right now compare to Intel still struggling with 10nm and squeezing 14nm forever. its a win for TSMC. by the time Intel 10nm is on mass production, TSMC 5nm or even 3nm will be out.
  - wtallis 6y ago
    Intel's 10nm as originally planned would have been superior to TSMC's original 7nm, if Intel's 10nm had actually been functional. But it didn't work and got cancelled and what they're calling 10nm now is what would have been called "10nm+" if they hadn't renamed their entire roadmap to cover up the failure. I'm not sure how close Intel's shipping 10nm comes to TSMC's original 7nm, but that's rapidly becoming irrelevant now that TSMC's 7nm+ with EUV is up and running.
- 6y ago

shmerl 6y ago

Interesting. Are they planning to use some kind of alternative energy sources for their plants?

duxup 6y ago

I wonder how they are going to make up for the economic reasons this isn't generally done in the US?

chvid 6y ago

I can see some American politicians are celebrating this as a blow to (communist) China. But is this not hurting Taiwan in a major strategic long term way? And risks turning the whole island towards mainland. And for the ones celebrating "Re-industrilization of America". Is the America you envision really a America which does not have anything of importance produced outside America. Even if outside means traditional allies such as Germany, Japan, Taiwan ... ?

tanilama 6y ago
Taiwanese people probably wish to not be strategic in a China-US battle. That only means the destruction of that island.
- chvid 6y ago
  Taiwan is strategic to the US-China battle because it is strategic to China; if Taiwan reunites with China, China will have full access to the Pacific.
fermienrico 6y ago
The narrative of American politicians, particularly President Trump, against Europeans has not manifested in the general public, especially in the tech industry. Americans and Europeans work together much in the same way, atleast in my personal experience and exposure to both continents. The tech industry is too smart to be manipulated by politicians.
- chvid 6y ago
  I can see from the comments that it is being celebrated here.

projektfu 6y ago

Didn’t AMD have a big fab in Arizona once?

baybal2 6y ago

This surreal, and this is a bombshell. TSMC is to build a second 5nm plant outside of their strategic roadmap, and has to get money for it out of the blue. How will it work out with their investors, only god knows. And this has ultimately to pass by Taiwanese government, if it didn't already.

deleted 6y ago
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lacker 6y ago

It would make a lot more sense than UBI if the US would chip in part of the salary, ie (cost of American worker - cost of Taiwanese worker), so that this sort of factory would no longer be disincentivized just because of the cost of American labor.

beefalo 6y ago
This effectively happens already by the massive property tax incentives for factories.

andy_ppp 6y ago

I think Europe would do well to thing about getting TSMC to build a fab in Europe, especially as a lot of the tools are already built here. Good to see the American government still functions in one way or another...

Nokinside 6y ago

Important detail: This is not GIGAFAB facility. Only 20,000 wafers per month is between mini- and megafab for TSMC. I suspect the production goes to US defense applications. Pompeo tweeting about it seems to confirm it. https://twitter.com/SecPompeo/status/1261143980634509318 https://twitter.com/SecPompeo/status/1261143980634509318? >Secretary Pompeo >@SecPompeo >The U.S. welcomes TSMC’s intention to invest $12B in the most advanced 5-nanometer semiconductor fabrication foundry in the world. This deal bolsters U.S. national security at a time when China is trying to dominate cutting-edge tech and control critical industries.

xxs 6y ago
Seems like the most of the discussion here totally missed that part - that would be no consumer grade chips and likely the prime client would be US military. 20k wafers (perhaps 450mm ones?) with unknown yield (likely 80ish) is quite low. For reference AMD 5700 has die area of ~250mm.
- Nokinside 6y ago
  I don't see how that big investment for relative low volume production would make sense for consumer products. If the fab is located inside the US, AMD and NVIDIA can bid for many US government contracts that would go for Intel. After GlobalFoundries quit the race, US defense contractors have only Intel as supplier for many components.
  - esmi 6y ago
    > I don't see how that big investment for relative low volume production would make sense for consumer products. If the consumer product is a toy then sure. If it’s a medical device then it could make sense. It’s all about margin. > After GlobalFoundries quit the race, US defense contractors have only Intel as supplier for many components. Maybe. If you want millions of chips a quarter then sure. But if you want 1000s a quarter then there are many options, depending on the node I guess. I’m not going to Google a complete list but one obvious example is Texas Instruments.

Denvercoder9 6y ago

Excuse the naive question, but what technology does a fab bring to the table? As I understand it, TSMC buys most (all?) of their equipment from ASML (or a competitor), and the chip design is done and owned by their customers. What's left, aside from a giant cleanroom and some specialized operators?

ridewinter 6y ago
Good question. There there must be something material otherwise TSMC wouldn't have such a lead on their competitors.

microcolonel 6y ago

Next we need a proper embassy. No more erasure of the true Chinese Republic with actual human rights, freedom, and prosperity for the many and not the connected few of the few.

helsinkiandrew 6y ago

I thought there was an interesting point in this economist article: https://www.economist.com/business/2020/05/21/americas-latest-salvo-against-huawei-is-aimed-at-chipmaking-in-china https://www.economist.com/business/2020/05/21/americas-lates... "tsmc could equip the Arizona foundry with American gear from its existing factories, freeing space in its Taiwanese operations for brand new non-American kit that can freely serve Chinese customers"