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> TSMC previously announced plans for a new factory in Arizona, a project that it valued at $12 billion and that is expected to receive federal subsidies. Samsu
by herodoturtle 6y ago
> TSMC previously announced plans for a new factory in Arizona, a project that it valued at $12 billion and that is expected to receive federal subsidies. Samsung is seeking government incentives for a $17 billion expansion of its facilities in Austin, Texas.
I found that point really interesting - and also perplexing.
I can understand why US companies would choose to outsource manufacturing concerns to East Asian countries, but I'm wondering why the opposite is true in this case here.
Could someone with insight into these matters please help me understand - why would TSMC or Samsung choose to build factories in the US?
Government subsidies on the upfront CapEx aside - I'm curious what the long term benefits to them would be.
Thanks :)
- throwaway4good 6y agoFor the same reasons Foxconn made a factory in Wisconsin?
- creato 6y agoDid that actually happen?
- throwaway4good 6y agoThe tax incentives and political celebration certainly did.
- stoolpigeon 6y agoNo - it never did.
- deergomoo 6y agoThey built buildings, they just never really did anything with them... https://en.wikipedia.org/wiki/Foxconn_in_Wisconsin https://en.wikipedia.org/wiki/Foxconn_in_Wisconsin
- mcdevilkiller 6y agoTariffs and such. Intel will always be more protected by the government, just because they are from the USA and very valuable.
- patrickk 6y ago> Could someone with insight into these matters please help me understand - why would TSMC or Samsung choose to build factories in the US? It's partially to mitigate supply risk. Recently, drought has worsened the supply of chip production, many of which are concentrated in Taiwan[1]. If you go on any PC parts forum, you will see that parts like new GPUs are nearly impossible to get. Some years back, flooding in Thailand[2] also threatened the supply of hard drives. [1] https://thediplomat.com/2021/03/taiwan-prays-for-rain-as-drought-threatens-chip-production/ https://thediplomat.com/2021/03/taiwan-prays-for-rain-as-dro... [2] https://www.theguardian.com/technology/2011/oct/25/thailand-floods-hard-drive-shortage https://www.theguardian.com/technology/2011/oct/25/thailand-...
- Scoundreller 6y agoMy friend can sell his 7y.o. GPU that he bought 3-4y ago for 50 EUR for 100EUR today. And it’s useless for mining.
- samvher 6y agoEven though mining doesn't directly drive up the price of that GPU, it does do so indirectly. Miners push gamers out of the new GPU market so the gamers go elsewhere. And old GPUs can be pretty valuable for making it through the year (while waiting to obtain something better).
- baybal2 6y ago> And it’s useless for mining. Tell these to people who keep mining at loss for god knows what reason
- gruturo 6y agoThey may be counting on the price going up in the future, given past trends. It's not like they have to immediately sell whatever they mine. (Yes, if you are really betting on that, you may as well skip the mining and buy the coins outright, but maybe they have cheap power or other reasons)
- 6y ago
- plater 6y agoA semiconductor factory is very expensive to build and run in terms of the actual building (vibration resistant, advanced ventilation with purified air etc) and the equipment inside (some of the most expensive machines you can buy). It's all extremely expensive. It is also fairly automated and requires few people to run compared to the value it outputs. So the cost of labor is low in comparison and thus it's not a big deal to put it in a high cost country.
- camillomiller 6y agoVibration resistance is interesting, considering most chip factories are in Taiwan, a country where I experienced an earthquake each and every time I was there.
- monocasa 6y agoIt's geopolitical. Taiwan is ultimately reliant on the US for defense from China. The DoD wants to maintain close to leading edge chip production on US soil where they feel like they can control the physical chain of security of the chips they use. TSMC builds a fab on US soil, and Taiwan and it's sovereignty wrt to China is better embedded in the power structure of the US defense strategy. The DoD footing most of the bill makes it an easy win.
- herodoturtle 6y agoThis was a really insightful comment, thanks for taking the time to explain.
- ksec 6y agoNow that Intel has opened up their Fab, I have been wondering if TSMC will still be going ahead with their Plan. It never made any sense in the first place. It is not leading edge and Intel seems to be a better position from DoD's perspective. And I wil not be suspired if future POWER and Z are all Intel Fabbed.
- onepointsixC 6y agoHow can they not? 60% of their customers are American and fab capacity has become a hot bipartisan topic as well as a NatSec issue. The only way they can guarantee that they don't lose access to their customers is by building American fabs.
- ksec 6y ago1. Fab Capacity has nothing to do with it. No one has committed to Fab Orders apart from Apple. It is politics and MSM Media decide to make an issue out of nothing. 2. Those Fabs are not leading edge and not target for the general consumer brands. The current target of 5nm in ~2024, a time when TSMC should be on 2nm GAAFET in their main Fab in Taiwan. 3. The only real reason is National Security, which is now being handled by Intel. These chip were used used and Fabbed by IBM and GF before GF's exit on leading edge. 4. 60% of TSMC's customers are US companies, but these US companies 's customer aren't 60% Americans. And not all Americans chips needs to be Fabbed locally.
- vmception 6y agoThere are a lot of natural resources in the US. And a lot of metals in the ground in Arizona and further south. Its honestly just overdue and this is as good as time as any to build this factory. Taiwan was good enough. Now things are getting hairy and these companies have gotten massive and the demand for chips has gotten greater. Time to build.
- nwatson 6y agoHow about also the legacy of a large number of fabs and of electronics design, manufacturing, and education in Arizona? Intel, Honeywell, Motorola, ASU ..., the list is large. Arizona has a wealth of semiconductor know-how. EDIT: not the best article but deals briefly with Arizona semiconductor history toward end of story article: https://www.allaboutcircuits.com/news/semiconductor-fabs-dotting-arizona-silicon-desert/ https://www.allaboutcircuits.com/news/semiconductor-fabs-dot...
- deleted 6y ago[deleted]
- shawnz 6y agoDon't you think it's wise for various reasons to have "offsite backups" of their technologies and production capacity? Even ignoring the political reasons, just consider what happened to WD and Seagate during the floods in Thailand in 2011.
- Beached 6y agoKorean corps hate china almost as much as us corps. CCP has been running anti korea product news for years which have eviscerated their businesses. Lately they have been going after cultural theft saying that they invented their language, their traditional clothing and even kimchi. Korea is fed up, and when forced to choose china or the west, they are choosing the west as a long term business investment.
- hrktb 6y agoIf it was the main reason, wouldn’t it have made more sense in more politically stable regions, like Germany or France, which are in good term with the US as well, and first level EU access as a bonus.
- ABeeSea 6y agoThey gain a massive new customer who still primarily relies on older nodes and will need to buy a staggering amount of new chips: the US military.