32 ms·

TSMC eyes Germany as possible location for first Europe chip plant

699 points by stereoradonc 5y ago

alexanderklein 5y ago
If i were TCMS, i would not invest in Germany. But as a german, living in Germany, i am happy that they consider an investment in Germany.
- cpach 5y ago
  Why not? From my POV Germany seems good at manufacturing. E.g. Siemens. And cars.
  - RicoElectrico 5y ago
    Probably red tape?
  - 988747 5y ago
    In general investment in the "old" EU countries is less profitable due to higher taxes, salaries, and other costs. That's why most of the European companies choose to build their new factories in Central Europe: Poland, Czech Republic, Slovakia, Romania, etc. TSMC should do the same.
    - RicoElectrico 5y ago
      I wish :) There's no infrastructure or know-how in Poland regarding microelectronics. The only related field is ASIC design - a few offices of American companies like Synopsys (>100 employees), Silicon Creations (a few dozen employees), Cadence (a few dozen as well). Intel has a massive R&D site but they don't do hardware design here, maybe except FPGA.
      - tester34 5y ago
        I'd bet that if they were opening actual edge fab in Poland, then the priest would appear to sprinkle EUV machine
      - cromka 5y ago
        Somewhat related though, that Poland has the only memory module fab in EU: https://en.wikipedia.org/wiki/Wilk_Elektronik https://en.wikipedia.org/wiki/Wilk_Elektronik https://www.goodram.com/en/ https://www.goodram.com/en/
      - adrian_b 5y ago
        In the more distant past, i.e. up to 1990, all the Eastern European countries, including Poland, had semiconductor plants and many people, both engineers and workers, with good know-how. However, after 1990, the plants have been closed and most of the skilled people have gone to USA, Canada or Western Europe. So for the present time you might be right, it could be difficult to find enough experienced workforce, unlike many years ago.
        bserge 5y ago
        You can find it in the west... But then you have to pay them a lot heh
    - raverbashing 5y ago
      This is more relevant when you're building lower technology items (toasters, gasoline engines, etc) Personal cost in semi factories is much less relevant (and you actually want the higher-cost employees because they know how to drive the multi-billion dollar machines)
    - lispm 5y ago
      TSMC would go to Dresden if it decides to invest in Germany. Bosch just opened a new chip fatory in Dresden. https://www.bosch.com/stories/bosch-chip-factory-dresden/ https://www.bosch.com/stories/bosch-chip-factory-dresden/ Globafoundries and Infinion are there, too. https://gfdresden.de https://gfdresden.de https://www.infineon.com/cms/dresden/en/ https://www.infineon.com/cms/dresden/en/ The Dresden/Saxony area is said to have in semiconductor manufacturing "2,300 companies with roughly 60,000 employees active in the industry in Saxony and generating revenues of some €16.5 billion last year." Apple invests heavily in a Chip design center in Munich. https://www.apple.com/uk/newsroom/2021/03/apple-to-invest-over-1-billion-euros-in-germany-with-new-munich-campus/ https://www.apple.com/uk/newsroom/2021/03/apple-to-invest-ov... Customers for the TSMC chips would be in the automotive industry. Tesla builds a new EV factory in Brandenburg near Berlin... Volkswagen has several factories working on current and future EVs, ... for example the ID.3 is being manufactured in Dresden, too. https://www.volkswagen-newsroom.com/en/press-releases/id3-starts-series-production-the-transparent-factory-in-dresden-to-become-the-home-of-the-volkswagen-id-6788 https://www.volkswagen-newsroom.com/en/press-releases/id3-st...
  - thrwyoilarticle 5y ago
    German engineering gave us BER
    - DangerousPie 5y ago
      What does the (mis)management of a public infrastructure project have to do with Germany's attractiveness as a base for manufacturing?
      - zorked 5y ago
        Everything?
      - thrwyoilarticle 5y ago
        Plants don't pop up overnight to the obliviousness of the state. This proposal brings into consideration vast amounts of money, tax revenue, and employment opportunities that the government will care about. All with unique infrastructure requirements and long roadplans. To flip the question around: what does the ability to produce executive cars have to do with Germany's ability to fix the problem Intel have been stuck on for the better part of a decade?
    - ng55QPSK 5y ago
      The lead of construction for BER was a dutch company
      - thrwyoilarticle 5y ago
        Imtech? It was their German branch. Regardless, at least they could rely on Siemens and Bosch to nail the fire system, PG BBI to do the planning, and GMP for the architecture.
  - Bigpet 5y ago
    Labor laws would still be sort of OK for a high-tech factory like TSMC. But I think environmental policy would be really hostile to a large fab. Politics seems really fickle about it too. For "old school" industries like coal they try to bend over backwards to make exceptions, but when it comes to new players especially local politics will have little reservations to tanking your multi million dollar projects. This can obviously be a huge benefit to the population, but if I were in the position to choose a location I'd factor that in heavily.
    - corty 5y ago
      Problem with new players imho is the high level of corruption in certain parts of government and industry. While you cannot usually bribe a policeman in Germany, construction, permitting and industry subsidies and politics are heavily corrupt. Old-school industries are propped up by an old-boys-network and revolving doors between political parties, unions, administration and industry. Many politicians who did well by the coal industry for example got their comfortable retirement position in the boards of energy giants. Same for the car industry. Parts of those industries are even still owned by the state or federal government, e.g. Volkswagen is partially owned by the state of Lower Saxony and Germany. That is also possibly the reason Tesla is in such trouble over their new factory. While they are a car manufacturer, and a modern, hip and green one at that, which politics openly hails as good, secretly they are damaging established interests by the traditional German car manufacturers and their allies in high positions. So the administration will nod and smile, but try to find ways to hinder them.
      - LeanderK 5y ago
        I think Tesla is just in such trouble because they were building their factory without having all permits. They were allowed to do that, but had to get all the permits in the end. As I understood it Tesla then build stuff that are not usually allowed, I suspect Tesla was trying to establish facts and thereby trying circumvent regulation. I don't really see the german government here at fault. They were eager to get the factory up and running and were working with Tesla to get it built quickly. If Tesla wants to build first and get the permits later, it also has to retroactively improve things when they were not up to code. You can't just get permits because you've built something.
  - lazyjones 5y ago
    Siemens was good 30 years ago. More recently, they seem a little bit too tied up with politics, hiring ex politicians, getting caught bribing (e.g. in Greece). It's not a pretty sight IMO and I wouldn't want to work there.
- martin_a 5y ago
  As a German myself: Why would you not invest? Infrastructure, state of mind? I'd really love to see more high-tech companies invest here, after we've managed to kill the solar companies... :-/
  - gallexme 5y ago
    As a German Permits, the government is V slow. And labor is expensive. Also sounds expensive to use all the water they need, since they would need to clean it up very good and align the temperature with the rest of the attached rivers or what they use. And other climate relevant regulations.
    - ChemSpider 5y ago
      Germany has plenty of water. Certainly more than Taiwan.
      - sabjut 5y ago
        That's what Elon Musk said too about the Brandenburg Facory ("Doesn't look like a desert so it must be ok") But environment groups are saying that ground water levels have been decreasing for years and the factory would demand too much from the water network. So who is in the right here?
        bildung 5y ago
        I assume Tesla was just trying to be cheap. As soon as the water supplier said Teslas expected demand (372 m³ per hour) wouldn't be possible, the demand suddenly shrank to 243 m³ per hour. So my guess is that Tesla tried to reduce capex by employing more wasteful water usage but now has to work more efficiently. https://www.quarks.de/umwelt/wie-problematisch-ist-der-bau-von-teslas-gigafabrik/ https://www.quarks.de/umwelt/wie-problematisch-ist-der-bau-v...
        tgsovlerkhgsel 5y ago
- hans1729 5y ago
  Germany is positioned excellently for chip production, why would you consider that a bad investment?
  - sichtlinkair 5y ago
    Genuinely curious why Germany's position is excellent for chip production?
    - lispm 5y ago
      Because it has one of the two largest clusters for that industry in Europe: Dresden/Saxony. The other one is Grenoble, France. https://www.dw.com/en/bosch-is-the-new-star-in-silicon-saxony-microchip-cluster/a-57767731 https://www.dw.com/en/bosch-is-the-new-star-in-silicon-saxon...
    - bildung 5y ago
      There are already quite a few plants (Globalfoundries, Bosch, Infineon, TI, Osram, ...) so the qualified work force is there. Germany is also pretty heavy on high tech production, so there's a big existing supplier network. Key suppliers like ASML are nearby (Both the Netherlands and Germany are part of the Schengen Agreement, so logistics-wise almost as open as cross-state transports within the US).
      - samus 5y ago
        Minor nitpick: Schengen does not matter, membership in the customs union does. For shipping, availability and quality of infrastructure is more important.
        rsynnott 5y ago
        Schengen and in the customs union is still a little better than non-Schengen and in the customs union (eg Ireland), but yeah, the customs union is the main thing.
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- raverbashing 5y ago
  Countries that have semi factories in Europe: Germany, Italy, France, Ireland, Netherlands, UK, Austria, Belgium, and Hungary (with different capabilities and sizes) So it would be natural that it ends on the countries with existing factories and expertise. The German (or even we might say, "north-european") self-deprecation gets old sometimes...
  - mejutoco 5y ago
    I have never heard of german self-deprecation. Do you have any examples of it?
    - kome 5y ago
      German self-deprecation? I wish! My impression is that Germans feel to be top notch no matter what. I rarely heard self-deprecation from them, humble brag is what come closer.
      - raverbashing 5y ago
        Yeah it's not so obvious or evident. What you're mentioning do happen. But there's a bit of a cultural theme to "play it low" and "be humble"
- odiroot 5y ago
  I wouldn't be as harsh, but indeed that decision is a bit weird. They cannot really count on cheap labour, or "friendly" economic incentives. And seeing the case of Tesla factory, it's not so easy and fast. One great thing about Germany is the central location within EU with good logistics overall. Not sure it matters for semiconductor manufacturing.
  - bildung 5y ago
    I wouldn't say Teslas Brandenburg factory shows a problem with red tape per se, but it does show that ignoring it won't save you time in Germany. Also, salaries usually only account for low single digit percentages of opex in high tech production, so ready availabilty of the needed specialists is probably more important.
    - Heliosmaster 5y ago
      For those companies involved in semiconductor industry, where machines cost 100M usd EACH... People are just a rounding error. Should we hire 100 more? 1000 more? Whatever
      - suction 5y ago
        Keep in mind that for a high-profile engineer or lead who expects to make 400k at least per year, the company would actually have to pay him 800k to make that much net. Labor cost in Germany is sky high. That times a thousand is not insignificant.
        lentil_soup 5y ago
        According to [1] if you make 400k a year your employer has to pay 413k in total [1] https://www.brutto-netto-rechner.info/gehalt/gehaltsrechner-arbeitgeber.php https://www.brutto-netto-rechner.info/gehalt/gehaltsrechner-...
        datenarsch 5y ago
- ChemSpider 5y ago
  Germany is a great place to invest. So is most of Western Europe. The #1 thing you are looking for is _stability_ and a good engineering job market. Both is available. For this kind of automated high-tech manufacturing, nobody cares about salaries. They are <<1% of the cost.
  - reader_mode 5y ago
    Is Germany really stable considering Tesla story ? Chip making isn't clean by any standard.
    - suction 5y ago
      The Tesla story had two sides - Tesla was aware about the high standards that would be applied to their factory, but somehow thought "we're Tesla so they'll create all kinds of exceptions for us if we pay the right politicians". Turns out not every country is as corrupt as Tesla's home country.
      - corty 5y ago
        Maybe. But I think all the politicians Tesla could have bought are already owned by their German competitors.
        detaro 5y ago
        There aren't any competitors in the state, and there has been basically no politically influential pushback, so that line of argument doesn't really make sense.
        corty 5y ago
        There is no overt pushback. That doesn't mean that there is none. And the presence and activity of the usual environmental NIMBY organisations like Deutsche Umwelthilfe, NABU, BUND, etc. point to at least some covert opposition, since those organisations happily serve as fronts for non-environmental interests. And state politics, especially in the east, is rife with people using it as a stepping stone to the federal level. Famously there once were more prime ministers from the west governing the east than eastern-born ones.
- emsy 5y ago
  Another German here, I agree. The regulatory hurdles are insane, the sentiment among the population is anti-business and I see the chance that the Green Party will be in the Next government as another negative point for businesses.
  - DaedPsyker 5y ago
    While I get the sentiment, regulatory issues would be only one factor to decide and in some cases not that big (medical for example is heavily regulated the world over). The fact that you guys have a large pool of talent for advanced manufacturing (for this kind of thing probably the biggest consideration), and central location with easy access to all other parts of Europe were the likely elements to win out. Don't sell yourself short.
  - Leherenn 5y ago
    It's not like it's very different in the rest of western Europe, and eastern Europe probably doesn't have the know-how to do it. If you want to be in the EU, Germany is far from the worst place.
- sveme 5y ago
  Aah, the self-deprecating German, so common it's almost a meme now. Remember, grass is always greener on the other side.
- nt2h9uh238h 5y ago
  Germany is hands-off the best country to invest in all of Europe.
- lazyjones 5y ago
  As a German, you'll pay for the subsidies with your taxes.
- RustyConsul 5y ago
  Tesla has had a million issues come up with attempting to build a factory in Germany. It's a regulation nightmare; Latest issue; snakes and trees.
nixass 5y ago
Make it Munich, make it Munich, make it Munich
- pacificmint 5y ago
  Wouldn’t Dresden seem more likely? I think after AMD built the first fab there in the nineties a lot of suppliers settled there as well?
- artemonster 5y ago
  I would also like that, but its highly unlikely :) Saxony is actively pushing towards becoming "Silicon Saxony". Munich established itself as a design hub.
  - tobessebot 5y ago
    Munich does have Infineon as well and it's closer to lots of the eventual customers in the automobile industry.
    - moooo99 5y ago
      But is the automotive industry really the main customers for TSMC? Judging by all the news I read about the company, the main reason for the hype is that they are always on the bleeding edge of semiconductor manufacturing, which isn't usually something that you'd find in the automotive sector. And assuming that the automotive industry is the target customer: Volkswagen has their biggest plant in Saxony, which is their main EV plant. Also, Saxony is reasonably close to Brandenburg where Tesla is currently building their factory.
      - ng55QPSK 5y ago
        Looking closely at the net of motorways, any part of germany is in close distance to VW, BWM, Daimler and Porsche.
      - baybal2 5y ago
        Automotive chips are less than 1% of TSMCs volume, but they can shout the loudest, have big pockets, and lobbying power.
ipnon 5y ago
TSMC is really the keystone for everything else done that ends up getting talked about on this website. They are constantly at the bleeding edge of computer manufacture and pushing it further still. We should feel some sense of amazement to be alive still in the middle of the computer revolution.
- openandshut 5y ago
  >still in the middle of the computer revolution Are you implying it will end? Either Moore's law leveling off or an externality (unrest/war/climate change) that ends it?
- tester34 5y ago
  Overall semiconducting industry seems to be way more exciting than boring computer industry
  - artemonster 5y ago
    ha! I guess you haven't worked as a designer or verification engineer, designing chips then? let me tell you: you work with a commitee-designed c++ like abomination language with 300 non-composible keywords that make no freaking sense. all of that crap grew from legacy-upon-legacy of crutches as an attempt to fix the goddamn broken-by-design verilog. Ultimately, this craplanguage + library that is 90% non-debuggable macros, works only with ~3 vendor simulators (all 3 would do different stuff on big designs and you are locked almost forever). When you simulate you designs, most of external components would be either encrypted blackboxes or be calling "magic" functions (called system tasks) that are absultely opaque to you and do some global side-effects. All of this multiplied by the fact that every statement is executed in parallel in your huge design and evolves in time. Oh, did I mention how crappy the actual tools are? Think of 90's era with outdated and moronic UI/UX, some poorely integrated quasi-TCL interpreter for configuration & ability to crash that tool in <3 clicks. Ah, you will be paying 15kUSD/year per license, thank you very much. You will be needing lots of them (> 50).
    - spaniard89277 5y ago
dirtyid 5y ago
Wonder how much TSMC Biontech vaccine deal influenced decision. Assume some level of gov involvement considering Germany was annoyed that US car manufactures got first dibs during shortage.
- MangoCoffee 5y ago
  >TSMC Biontech vaccine deal influenced decision that'll be really stupid to build billion dollar fab just because of that. Japan can sell/donate AZ vaccine since they have a deal with AZ and American can sell moderna which Taiwan bought. either way, it is a really stupid business decision if that's case.
  - dirtyid 5y ago
    In context of broader geopolitical developments, it was also "really stupid" for TSMC to build new US fabs after already planning record capex in TW proper in 2019. Few thought TW would erode their silicon shield by allow TSMC to expand fabs abroad. Right now both US/EU wants to reshore semi supply chain, and both have the leverage to coerce TSMC/TW into submitting against their own interests since TSMC is wholey reliant on US/EU tech. Side considerations like semi subsidies and vaccines are there to sweeten pot. The timing is interesting since this follows shortly after TSMC Biontech deal. IMO there was never any doubt EU would get TSMC expansion, question was who had the leverage to determine where. Most of interviews by Morris Chang suggest he's not enthused about fragmenting supply chains, yet we keep seeing new fabs outside of TW being proposed. Whether these proposals are serious or performative is another qusetion.
    - MangoCoffee 5y ago
      >it was also "really stupid" for TSMC to build new US fabs after already planning record capex in TW proper in 2019. Few thought TW would erode their silicon shield by allow TSMC to expand fabs abroad. US is offering incentives for TSMC to build a fab in AZ. the original announcement is a smaller scale production for 5nm that won't come online for couple years. TSMC will be on 2nm by then. Is EU offering anything? I haven't hear anything. I doubt TSMC will make the move if there is nothing for them consider the cost of a modern fab and labors cost. >TW would erode their silicon shield by allow TSMC to expand fabs abroad that's not smart if Taiwan is depend on silicon shield for their security. silicon shield is a media's term that Taiwanese govrt never use. a govrt shouldn't depend on anyone but itself for its own security.
fxtentacle 5y ago
If you consider GlobalFoundries to be a valid competitor, then that move would make a lot of sense. Infineon and AMD used to do a lot of research and production in Dresden. The AMD fab has since become a part of GlobalFoundries. But there's still a healthy ecosystem of university research and medium-sized software companies. Or at least there was, when I visited GlobalFoundries in 2014. Also, there has been a growing amount of research activity into chip design in Germany lately, driven in no small part by CERN's needs. For example https://ohwr.org/project/white-rabbit/wikis/home https://ohwr.org/project/white-rabbit/wikis/home used by the Control and Timing System at CERN and GSI
- spaniard89277 5y ago
  Very interesting. Clicking around seems they have open hardware suppliers in the EU.
- gsnedders 5y ago
  There's also Texas Instruments in Freising (near Munich), which I think is ex-NatSemi, and AFAIK now their only European fab after the closure of their one in Greenock (Scotland).
  - nixass 5y ago
    Also Apple is heavily investing into chip design in their Munich campus.
    - Bombthecat 5y ago
      Yeah, just thought that they probably pick munich / near munich.
- rurban 5y ago
  We don't have enough water anymore in Dresden
  - j_walter 5y ago
NicoJuicy 5y ago
This is a good move for TSMC. A lot of action happens through ASML ( Netherlands) and IMEC ( Belgium). Germany is relatively close to both.
- xadhominemx 5y ago
  Why would the locations of those research organizations matter?
  - NicoJuicy 5y ago
    Because while TSMC is production, the innovation happens mostly with those companies.
    - xadhominemx 5y ago
      Ya but why does it matter that those organizations are in Europe? The distance does not matter and in any event TSMC is not contemplating building a leading edge plant in Europe
      - mqus 5y ago
        Depending on how close the interactions are, having similar timezones can be pretty important
    - MangoCoffee 5y ago
      TSMC's innovation on production is impressive as well like the on chip water cooling. https://www.extremetech.com/computing/324625-tsmc-mulls-on-chip-water-cooling-for-future-high-performance-silicon https://www.extremetech.com/computing/324625-tsmc-mulls-on-c...
      - NicoJuicy 5y ago
        3nm and the future 2nm and 1nm is all with research from Europe.
nbevans 5y ago
I find it surprising that they are choosing Germany - after everybody is seeing what Germany is doing to Tesla's Gigafactory there (embroiling it in so much red tape that Elon wishes he could pull out if it weren't for sunk cost). It seems that Germany has a very good ability to convince and lobby these mega-manufacturers to base themselves there, but a very poor ability to actually let them succeed after making that decision. TSMC would be wiser to invest in the UK - where there is a strong political will to remove barriers to entry - and it is of course where ARM are already based and therefore has a very strong overlap of skills. There is also far less likelihood of exports being restricted during a possible future crisis by the political whims of failed politicians i.e. it is a politically more stable bet.
- flohofwoe 5y ago
  There's a bit of a "silicon cluster" around Dresden in Germany going all the way back to the late 60s and 70s (the GDR had pretty impressive chip manufacturing capabilities for such a small country on the wrong side of the Iron Curtain). Also regarding the "red tape", this depends a lot on the state you're in. Brandenburg/Berlin vs Saxony/Thuringia/Bavaria can be very different in that regard (of course it depends a lot on the local government that's currently in place).
- kall 5y ago
  I think the government considers semiconductors a key industry to compete with china and I believe that matters. American electric car manufacturers on the other hand are a threat to germany's combustion obsessed car industry. I also think that Elon runs his companies in an unconventional way that maybe doesn‘t fly with german bureaucrats. TSMC will do things by the book and the saxonian government will welcome them with open arms. They won‘t see any of the local government trouble that Tesla had in Dresden.
- estaseuropano 5y ago
  Germany has dozens of chip manufacturers and great engineering workforce. Certainly much better than UK. Have not seen any wupte about Tesla wanting to pull out, but the factory is already half operational so seems most issues are resolved. Once located it should also be easier to do this kind of projects, but planting a new huge factory is always a challenge.
nazrulmum10 5y ago
its a great news for Germany . If TSMC located their chip plant in there.
LatteLazy 5y ago
A lot of people seem to think (high, German) Labour costs matter in this desicion. I don't think they do. If TSCM hires someone 1% better than the other guy, he makes them millions more with a better design/brighter idea etc. So paying 50% more on his salary is very affordable. That's the difference between a high tech company and amazon, Walmart etc. Germany seems like exactly the place I'd look for a highly educated workforce and one with a strong engineering culture. AND a place where workers will stay for a lifetime not just jump ship every 24months or take a fat cheque from China to move there and build them a TSCM copy. I'd be more worried about German pollution, health and safety etc laws, as this is a dirty industry. And I'd be more worried about getting a big chunk of land and planning permission.
jansan 5y ago
Also, according to article linked below (in German), Intel is considering building a semiconductor factory in Germany. The had plans in 2003, but the project failed and cost the German taxpayer a small fortune. I am very sceptical regarding the plans of Intel, but the TSMC plan sounds promising. If I were to decide, I would build a factory in Saxonia near Dresden. People there are traditionally inventive, labor costs are far lower than in the Munich region, and there is a lot of skill available due to the previous AMD investments. Link to article: https://www.berliner-zeitung.de/mensch-metropole/chipfabrik-von-intel-in-frankfurt-oder-es-geht-um-milliarden-li.162695 https://www.berliner-zeitung.de/mensch-metropole/chipfabrik-...
atc 5y ago
A UK FreePort would be far more beneficial for skill set, JIT trade and global connectivity. Plus a long way from the stranglehold of EU protectionism, red tape and corruption
polskibus 5y ago
Just recently we've discussed "faltering" talks in Europe https://news.ycombinator.com/item?id=27161217 https://news.ycombinator.com/item?id=27161217 and "eyeing" Japan https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-eyes-plans-for-first-chip-plant-in-Japan https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-ey... I wonder if this media noise is more to do with negotiation tactics than with real intentions.
- shoto_io 5y ago
  They gotta talk about something… and for that they need to amplify the smallest signal into a trend! I mean noise…
- rossdavidh 5y ago
  I think that they are, in fact, intending to open new fabs in both Japan and Europe. Given the presence of GlobalFoundries and others in Germany, that would make sense for a European base. This doesn't mean that it's not _also_ intended to help with negotiations, of course. It can be both true, and stated out loud for the purpose of seeing what other offers come up.
- mm983 5y ago
  they are building one in japan
gfiorav 5y ago
This is a major geopolitical decission. TSMC is responisble for 1/3 of chips worldwide (in an industry with few players). China's claim on Taiwan has a lot to do with that.
mrlonglong 5y ago
I'm not sure why they didn't consider the UK, plenty of high tech here and the Russians won't find us a walk over if they ever do come.
- totalZero 5y ago
  I think there are some obvious trade barriers that the British imposed upon themselves.
  - mrlonglong 5y ago
    That's true that 51% voted didn't give a crap about how this will affect business and trade. Serves them right for cutting their nose to spite others. And I'm half British !
bogomipz 5y ago
I was curious about this statement: >"TSMC supplies chips to almost all the key global chip developers, from Apple, Qualcomm and Advanced Microelectronics Devices to Intel, Infineon and Sony." When exactly did Intel become a customer of TSMC? Is this for a recent process technology or is this only for specific types of chips? I under the impression Intel chips always came from their own fabs.
- jhickok 5y ago
  https://asia.nikkei.com/Business/Tech/Semiconductors/Apple-and-Intel-become-first-to-adopt-TSMC-s-latest-chip-tech https://asia.nikkei.com/Business/Tech/Semiconductors/Apple-a...
- totalZero 5y ago
  Intel has been a customer of TSMC on the small-time stuff for a while now, if you consider the fact that they acquire companies that do business with TSMC (including Altera). However, the leading-edge customer relationship is very new[0]. I read it as a form of defense against AMD in the short term (pricing power and availability) and against Apple in the long term (x86 vs Apple Silicon). [0] https://www.tomshardware.com/news/intel-to-outsource-some-key-cpu-production-for-2023-chips https://www.tomshardware.com/news/intel-to-outsource-some-ke...
- aryonoco 5y ago
  Intel has been a TSMC client for many years. Not for their CPUs but for many of the multitude of other chips that Intel produces, from NICs to Wifi chips. Current estimates is that 7.2% of TSMC's revenue comes from Intel, which makes Intel TSMC'S 6th biggest client, only marginally behind AMD (9.2%) https://seekingalpha.com/article/4414346-samsung-won-t-soon-overtake-taiwan-semi-despite-massive-capex-spend https://seekingalpha.com/article/4414346-samsung-won-t-soon-...
varispeed 5y ago
From a security point of view, it's interesting that they don't look to build a fab in the UK. Given that the Europe used to be an arena of devastating conflicts - with things like completely levelled down cities, to murders on an industrial scale, the long term investment like this may be subject to a lot of uncertainty as the EU moves closer towards being an authoritarian regime, this may wake up internal conflicts that are deeply embedded in some of the nations.
- dangerface 5y ago
  The last European war was over 70 years ago and today it is one of if not the most stable regions in the world. The idea that they are doom spiralling into authoritarianism is a conspiracy theory that is easy to dismiss.
  - varispeed 5y ago
    Were you born yesterday? https://en.wikipedia.org/wiki/List_of_conflicts_in_Europe#Ongoing_conflicts https://en.wikipedia.org/wiki/List_of_conflicts_in_Europe#On...
    - dangerface 5y ago
      Did you even look at your link? 5 Eastern bloc countries having independent wars with the USSR in the 80s is hardly a current arena of conflict, weak. Obviously the middle east or the americas would be a better location, I'm joking obviously. https://en.wikipedia.org/wiki/List_of_modern_conflicts_in_the_Middle_East https://en.wikipedia.org/wiki/List_of_modern_conflicts_in_th...
pomian 5y ago
I'm wondering about Italy. They have an established industrial base. They manufacture a surprising amount of high tech, but don't brag about it like Germany. Many good European neighbours to provide a broad range of skilled workers and researchers.
- username90 5y ago
  Italy is tech hostile like most of southern Europe, engineers are paid horribly compared to other professions so they usually leave north.
sativallday 5y ago
This feel like corporate geopolitical diplomacy.
- flavius29663 5y ago
  It sure does, the EU announces they're going to invest X tens of billions in chips, and the next thing you know, the largest backer and beneficiary of EU gets this new factory.
- eruleman 5y ago
  Yup! My favorite Stratechery post is on this very topic, Chips and Geopolitics: https://stratechery.com/2020/chips-and-geopolitics/ https://stratechery.com/2020/chips-and-geopolitics/
poxwole 5y ago
I hope the German ans EU labour laws atleast make the working conditions bearable. Working at TSMC is hellish. I worked as a tool vendor. It was crazy.
cbmuser 5y ago
Germany has the highest electricity prices worldwide. I wouldn’t build any larger factory there these days: > https://www.statista.com/statistics/263492/electricity-prices-in-selected-countries/ https://www.statista.com/statistics/263492/electricity-price...
- geff82 5y ago
  Energy hungry industries don't have to pay all the energy taxes+fees. For them, Germany is a rather cheap place to be.
pomian 5y ago
Europe has so many great countries. Street reading the comments about Germany and it's internal policies, why not choose elsewhere? Finland, Sweden, Poland, etc etc etc
- paxys 5y ago
  What policies? Germany is many notches above the rest of the EU when it comes to manufacturing infrastructure and labor force. It's the obvious choice for such a large scale and expensive setup.
Havoc 5y ago
It does make some sort of sense if you're trying to stay clear of the US/China catfight & EU is not a bad place to start in that regard. Plus it ticks the box of EU origin, which is interesting in itself if you want to expand there.
nsonha 5y ago
not really related but I found this really interesting channel with many TSMC/Taiwan/semiconducting related video, as well as asian geopolitics if you're into that https://www.youtube.com/watch?v=oAlU6vQ1Pn8 https://www.youtube.com/watch?v=oAlU6vQ1Pn8
deleted 5y ago
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lonelyasacloud 5y ago
Bad news for Taiwan. The more that's moved off the island the less the West is going to feel compelled to defend it.
greeee32 5y ago
EU has too much bureaucracy, taxes and it's just not a good place to do a business.
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699 points by stereoradonc 5y ago

If i were TCMS, i would not invest in Germany. But as a german, living in Germany, i am happy that they consider an investment in Germany.

cpach 5y ago
Why not? From my POV Germany seems good at manufacturing. E.g. Siemens. And cars.
- RicoElectrico 5y ago
  Probably red tape?
- 988747 5y ago
  In general investment in the "old" EU countries is less profitable due to higher taxes, salaries, and other costs. That's why most of the European companies choose to build their new factories in Central Europe: Poland, Czech Republic, Slovakia, Romania, etc. TSMC should do the same.
  - RicoElectrico 5y ago
    I wish :) There's no infrastructure or know-how in Poland regarding microelectronics. The only related field is ASIC design - a few offices of American companies like Synopsys (>100 employees), Silicon Creations (a few dozen employees), Cadence (a few dozen as well). Intel has a massive R&D site but they don't do hardware design here, maybe except FPGA.
    - tester34 5y ago
      I'd bet that if they were opening actual edge fab in Poland, then the priest would appear to sprinkle EUV machine
    - cromka 5y ago
      Somewhat related though, that Poland has the only memory module fab in EU: https://en.wikipedia.org/wiki/Wilk_Elektronik https://en.wikipedia.org/wiki/Wilk_Elektronik https://www.goodram.com/en/ https://www.goodram.com/en/
    - adrian_b 5y ago
      In the more distant past, i.e. up to 1990, all the Eastern European countries, including Poland, had semiconductor plants and many people, both engineers and workers, with good know-how. However, after 1990, the plants have been closed and most of the skilled people have gone to USA, Canada or Western Europe. So for the present time you might be right, it could be difficult to find enough experienced workforce, unlike many years ago.
      - bserge 5y ago
        You can find it in the west... But then you have to pay them a lot heh
  - raverbashing 5y ago
    This is more relevant when you're building lower technology items (toasters, gasoline engines, etc) Personal cost in semi factories is much less relevant (and you actually want the higher-cost employees because they know how to drive the multi-billion dollar machines)
  - lispm 5y ago
    TSMC would go to Dresden if it decides to invest in Germany. Bosch just opened a new chip fatory in Dresden. https://www.bosch.com/stories/bosch-chip-factory-dresden/ https://www.bosch.com/stories/bosch-chip-factory-dresden/ Globafoundries and Infinion are there, too. https://gfdresden.de https://gfdresden.de https://www.infineon.com/cms/dresden/en/ https://www.infineon.com/cms/dresden/en/ The Dresden/Saxony area is said to have in semiconductor manufacturing "2,300 companies with roughly 60,000 employees active in the industry in Saxony and generating revenues of some €16.5 billion last year." Apple invests heavily in a Chip design center in Munich. https://www.apple.com/uk/newsroom/2021/03/apple-to-invest-over-1-billion-euros-in-germany-with-new-munich-campus/ https://www.apple.com/uk/newsroom/2021/03/apple-to-invest-ov... Customers for the TSMC chips would be in the automotive industry. Tesla builds a new EV factory in Brandenburg near Berlin... Volkswagen has several factories working on current and future EVs, ... for example the ID.3 is being manufactured in Dresden, too. https://www.volkswagen-newsroom.com/en/press-releases/id3-starts-series-production-the-transparent-factory-in-dresden-to-become-the-home-of-the-volkswagen-id-6788 https://www.volkswagen-newsroom.com/en/press-releases/id3-st...
- thrwyoilarticle 5y ago
  German engineering gave us BER
  - DangerousPie 5y ago
    What does the (mis)management of a public infrastructure project have to do with Germany's attractiveness as a base for manufacturing?
    - zorked 5y ago
      Everything?
    - thrwyoilarticle 5y ago
      Plants don't pop up overnight to the obliviousness of the state. This proposal brings into consideration vast amounts of money, tax revenue, and employment opportunities that the government will care about. All with unique infrastructure requirements and long roadplans. To flip the question around: what does the ability to produce executive cars have to do with Germany's ability to fix the problem Intel have been stuck on for the better part of a decade?
  - ng55QPSK 5y ago
    The lead of construction for BER was a dutch company
    - thrwyoilarticle 5y ago
      Imtech? It was their German branch. Regardless, at least they could rely on Siemens and Bosch to nail the fire system, PG BBI to do the planning, and GMP for the architecture.
- Bigpet 5y ago
  Labor laws would still be sort of OK for a high-tech factory like TSMC. But I think environmental policy would be really hostile to a large fab. Politics seems really fickle about it too. For "old school" industries like coal they try to bend over backwards to make exceptions, but when it comes to new players especially local politics will have little reservations to tanking your multi million dollar projects. This can obviously be a huge benefit to the population, but if I were in the position to choose a location I'd factor that in heavily.
  - corty 5y ago
    Problem with new players imho is the high level of corruption in certain parts of government and industry. While you cannot usually bribe a policeman in Germany, construction, permitting and industry subsidies and politics are heavily corrupt. Old-school industries are propped up by an old-boys-network and revolving doors between political parties, unions, administration and industry. Many politicians who did well by the coal industry for example got their comfortable retirement position in the boards of energy giants. Same for the car industry. Parts of those industries are even still owned by the state or federal government, e.g. Volkswagen is partially owned by the state of Lower Saxony and Germany. That is also possibly the reason Tesla is in such trouble over their new factory. While they are a car manufacturer, and a modern, hip and green one at that, which politics openly hails as good, secretly they are damaging established interests by the traditional German car manufacturers and their allies in high positions. So the administration will nod and smile, but try to find ways to hinder them.
    - LeanderK 5y ago
      I think Tesla is just in such trouble because they were building their factory without having all permits. They were allowed to do that, but had to get all the permits in the end. As I understood it Tesla then build stuff that are not usually allowed, I suspect Tesla was trying to establish facts and thereby trying circumvent regulation. I don't really see the german government here at fault. They were eager to get the factory up and running and were working with Tesla to get it built quickly. If Tesla wants to build first and get the permits later, it also has to retroactively improve things when they were not up to code. You can't just get permits because you've built something.
- lazyjones 5y ago
  Siemens was good 30 years ago. More recently, they seem a little bit too tied up with politics, hiring ex politicians, getting caught bribing (e.g. in Greece). It's not a pretty sight IMO and I wouldn't want to work there.
martin_a 5y ago
As a German myself: Why would you not invest? Infrastructure, state of mind? I'd really love to see more high-tech companies invest here, after we've managed to kill the solar companies... :-/
- gallexme 5y ago
  As a German Permits, the government is V slow. And labor is expensive. Also sounds expensive to use all the water they need, since they would need to clean it up very good and align the temperature with the rest of the attached rivers or what they use. And other climate relevant regulations.
  - ChemSpider 5y ago
    Germany has plenty of water. Certainly more than Taiwan.
    - sabjut 5y ago
      That's what Elon Musk said too about the Brandenburg Facory ("Doesn't look like a desert so it must be ok") But environment groups are saying that ground water levels have been decreasing for years and the factory would demand too much from the water network. So who is in the right here?
      - bildung 5y ago
        I assume Tesla was just trying to be cheap. As soon as the water supplier said Teslas expected demand (372 m³ per hour) wouldn't be possible, the demand suddenly shrank to 243 m³ per hour. So my guess is that Tesla tried to reduce capex by employing more wasteful water usage but now has to work more efficiently. https://www.quarks.de/umwelt/wie-problematisch-ist-der-bau-von-teslas-gigafabrik/ https://www.quarks.de/umwelt/wie-problematisch-ist-der-bau-v...
        tgsovlerkhgsel 5y ago
hans1729 5y ago
Germany is positioned excellently for chip production, why would you consider that a bad investment?
- sichtlinkair 5y ago
  Genuinely curious why Germany's position is excellent for chip production?
  - lispm 5y ago
    Because it has one of the two largest clusters for that industry in Europe: Dresden/Saxony. The other one is Grenoble, France. https://www.dw.com/en/bosch-is-the-new-star-in-silicon-saxony-microchip-cluster/a-57767731 https://www.dw.com/en/bosch-is-the-new-star-in-silicon-saxon...
  - bildung 5y ago
    There are already quite a few plants (Globalfoundries, Bosch, Infineon, TI, Osram, ...) so the qualified work force is there. Germany is also pretty heavy on high tech production, so there's a big existing supplier network. Key suppliers like ASML are nearby (Both the Netherlands and Germany are part of the Schengen Agreement, so logistics-wise almost as open as cross-state transports within the US).
    - samus 5y ago
      Minor nitpick: Schengen does not matter, membership in the customs union does. For shipping, availability and quality of infrastructure is more important.
      - rsynnott 5y ago
        Schengen and in the customs union is still a little better than non-Schengen and in the customs union (eg Ireland), but yeah, the customs union is the main thing.
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raverbashing 5y ago
Countries that have semi factories in Europe: Germany, Italy, France, Ireland, Netherlands, UK, Austria, Belgium, and Hungary (with different capabilities and sizes) So it would be natural that it ends on the countries with existing factories and expertise. The German (or even we might say, "north-european") self-deprecation gets old sometimes...
- mejutoco 5y ago
  I have never heard of german self-deprecation. Do you have any examples of it?
  - kome 5y ago
    German self-deprecation? I wish! My impression is that Germans feel to be top notch no matter what. I rarely heard self-deprecation from them, humble brag is what come closer.
    - raverbashing 5y ago
      Yeah it's not so obvious or evident. What you're mentioning do happen. But there's a bit of a cultural theme to "play it low" and "be humble"
odiroot 5y ago
I wouldn't be as harsh, but indeed that decision is a bit weird. They cannot really count on cheap labour, or "friendly" economic incentives. And seeing the case of Tesla factory, it's not so easy and fast. One great thing about Germany is the central location within EU with good logistics overall. Not sure it matters for semiconductor manufacturing.
- bildung 5y ago
  I wouldn't say Teslas Brandenburg factory shows a problem with red tape per se, but it does show that ignoring it won't save you time in Germany. Also, salaries usually only account for low single digit percentages of opex in high tech production, so ready availabilty of the needed specialists is probably more important.
  - Heliosmaster 5y ago
    For those companies involved in semiconductor industry, where machines cost 100M usd EACH... People are just a rounding error. Should we hire 100 more? 1000 more? Whatever
    - suction 5y ago
      Keep in mind that for a high-profile engineer or lead who expects to make 400k at least per year, the company would actually have to pay him 800k to make that much net. Labor cost in Germany is sky high. That times a thousand is not insignificant.
      - lentil_soup 5y ago
        According to [1] if you make 400k a year your employer has to pay 413k in total [1] https://www.brutto-netto-rechner.info/gehalt/gehaltsrechner-arbeitgeber.php https://www.brutto-netto-rechner.info/gehalt/gehaltsrechner-...
        datenarsch 5y ago
ChemSpider 5y ago
Germany is a great place to invest. So is most of Western Europe. The #1 thing you are looking for is _stability_ and a good engineering job market. Both is available. For this kind of automated high-tech manufacturing, nobody cares about salaries. They are <<1% of the cost.
- reader_mode 5y ago
  Is Germany really stable considering Tesla story ? Chip making isn't clean by any standard.
  - suction 5y ago
    The Tesla story had two sides - Tesla was aware about the high standards that would be applied to their factory, but somehow thought "we're Tesla so they'll create all kinds of exceptions for us if we pay the right politicians". Turns out not every country is as corrupt as Tesla's home country.
    - corty 5y ago
      Maybe. But I think all the politicians Tesla could have bought are already owned by their German competitors.
      - detaro 5y ago
        There aren't any competitors in the state, and there has been basically no politically influential pushback, so that line of argument doesn't really make sense.
        corty 5y ago
        There is no overt pushback. That doesn't mean that there is none. And the presence and activity of the usual environmental NIMBY organisations like Deutsche Umwelthilfe, NABU, BUND, etc. point to at least some covert opposition, since those organisations happily serve as fronts for non-environmental interests. And state politics, especially in the east, is rife with people using it as a stepping stone to the federal level. Famously there once were more prime ministers from the west governing the east than eastern-born ones.
emsy 5y ago
Another German here, I agree. The regulatory hurdles are insane, the sentiment among the population is anti-business and I see the chance that the Green Party will be in the Next government as another negative point for businesses.
- DaedPsyker 5y ago
  While I get the sentiment, regulatory issues would be only one factor to decide and in some cases not that big (medical for example is heavily regulated the world over). The fact that you guys have a large pool of talent for advanced manufacturing (for this kind of thing probably the biggest consideration), and central location with easy access to all other parts of Europe were the likely elements to win out. Don't sell yourself short.
- Leherenn 5y ago
  It's not like it's very different in the rest of western Europe, and eastern Europe probably doesn't have the know-how to do it. If you want to be in the EU, Germany is far from the worst place.
sveme 5y ago
Aah, the self-deprecating German, so common it's almost a meme now. Remember, grass is always greener on the other side.
nt2h9uh238h 5y ago
Germany is hands-off the best country to invest in all of Europe.
lazyjones 5y ago
As a German, you'll pay for the subsidies with your taxes.
RustyConsul 5y ago
Tesla has had a million issues come up with attempting to build a factory in Germany. It's a regulation nightmare; Latest issue; snakes and trees.

nixass 5y ago

Make it Munich, make it Munich, make it Munich

pacificmint 5y ago
Wouldn’t Dresden seem more likely? I think after AMD built the first fab there in the nineties a lot of suppliers settled there as well?
artemonster 5y ago
I would also like that, but its highly unlikely :) Saxony is actively pushing towards becoming "Silicon Saxony". Munich established itself as a design hub.
- tobessebot 5y ago
  Munich does have Infineon as well and it's closer to lots of the eventual customers in the automobile industry.
  - moooo99 5y ago
    But is the automotive industry really the main customers for TSMC? Judging by all the news I read about the company, the main reason for the hype is that they are always on the bleeding edge of semiconductor manufacturing, which isn't usually something that you'd find in the automotive sector. And assuming that the automotive industry is the target customer: Volkswagen has their biggest plant in Saxony, which is their main EV plant. Also, Saxony is reasonably close to Brandenburg where Tesla is currently building their factory.
    - ng55QPSK 5y ago
      Looking closely at the net of motorways, any part of germany is in close distance to VW, BWM, Daimler and Porsche.
    - baybal2 5y ago
      Automotive chips are less than 1% of TSMCs volume, but they can shout the loudest, have big pockets, and lobbying power.

ipnon 5y ago

TSMC is really the keystone for everything else done that ends up getting talked about on this website. They are constantly at the bleeding edge of computer manufacture and pushing it further still. We should feel some sense of amazement to be alive still in the middle of the computer revolution.

openandshut 5y ago
>still in the middle of the computer revolution Are you implying it will end? Either Moore's law leveling off or an externality (unrest/war/climate change) that ends it?
tester34 5y ago
Overall semiconducting industry seems to be way more exciting than boring computer industry
- artemonster 5y ago
  ha! I guess you haven't worked as a designer or verification engineer, designing chips then? let me tell you: you work with a commitee-designed c++ like abomination language with 300 non-composible keywords that make no freaking sense. all of that crap grew from legacy-upon-legacy of crutches as an attempt to fix the goddamn broken-by-design verilog. Ultimately, this craplanguage + library that is 90% non-debuggable macros, works only with ~3 vendor simulators (all 3 would do different stuff on big designs and you are locked almost forever). When you simulate you designs, most of external components would be either encrypted blackboxes or be calling "magic" functions (called system tasks) that are absultely opaque to you and do some global side-effects. All of this multiplied by the fact that every statement is executed in parallel in your huge design and evolves in time. Oh, did I mention how crappy the actual tools are? Think of 90's era with outdated and moronic UI/UX, some poorely integrated quasi-TCL interpreter for configuration & ability to crash that tool in <3 clicks. Ah, you will be paying 15kUSD/year per license, thank you very much. You will be needing lots of them (> 50).
  - spaniard89277 5y ago

dirtyid 5y ago

Wonder how much TSMC Biontech vaccine deal influenced decision. Assume some level of gov involvement considering Germany was annoyed that US car manufactures got first dibs during shortage.

MangoCoffee 5y ago
>TSMC Biontech vaccine deal influenced decision that'll be really stupid to build billion dollar fab just because of that. Japan can sell/donate AZ vaccine since they have a deal with AZ and American can sell moderna which Taiwan bought. either way, it is a really stupid business decision if that's case.
- dirtyid 5y ago
  In context of broader geopolitical developments, it was also "really stupid" for TSMC to build new US fabs after already planning record capex in TW proper in 2019. Few thought TW would erode their silicon shield by allow TSMC to expand fabs abroad. Right now both US/EU wants to reshore semi supply chain, and both have the leverage to coerce TSMC/TW into submitting against their own interests since TSMC is wholey reliant on US/EU tech. Side considerations like semi subsidies and vaccines are there to sweeten pot. The timing is interesting since this follows shortly after TSMC Biontech deal. IMO there was never any doubt EU would get TSMC expansion, question was who had the leverage to determine where. Most of interviews by Morris Chang suggest he's not enthused about fragmenting supply chains, yet we keep seeing new fabs outside of TW being proposed. Whether these proposals are serious or performative is another qusetion.
  - MangoCoffee 5y ago
    >it was also "really stupid" for TSMC to build new US fabs after already planning record capex in TW proper in 2019. Few thought TW would erode their silicon shield by allow TSMC to expand fabs abroad. US is offering incentives for TSMC to build a fab in AZ. the original announcement is a smaller scale production for 5nm that won't come online for couple years. TSMC will be on 2nm by then. Is EU offering anything? I haven't hear anything. I doubt TSMC will make the move if there is nothing for them consider the cost of a modern fab and labors cost. >TW would erode their silicon shield by allow TSMC to expand fabs abroad that's not smart if Taiwan is depend on silicon shield for their security. silicon shield is a media's term that Taiwanese govrt never use. a govrt shouldn't depend on anyone but itself for its own security.

fxtentacle 5y ago

If you consider GlobalFoundries to be a valid competitor, then that move would make a lot of sense. Infineon and AMD used to do a lot of research and production in Dresden. The AMD fab has since become a part of GlobalFoundries. But there's still a healthy ecosystem of university research and medium-sized software companies. Or at least there was, when I visited GlobalFoundries in 2014. Also, there has been a growing amount of research activity into chip design in Germany lately, driven in no small part by CERN's needs. For example https://ohwr.org/project/white-rabbit/wikis/home https://ohwr.org/project/white-rabbit/wikis/home used by the Control and Timing System at CERN and GSI

spaniard89277 5y ago
Very interesting. Clicking around seems they have open hardware suppliers in the EU.
gsnedders 5y ago
There's also Texas Instruments in Freising (near Munich), which I think is ex-NatSemi, and AFAIK now their only European fab after the closure of their one in Greenock (Scotland).
- nixass 5y ago
  Also Apple is heavily investing into chip design in their Munich campus.
  - Bombthecat 5y ago
    Yeah, just thought that they probably pick munich / near munich.
rurban 5y ago
We don't have enough water anymore in Dresden
- j_walter 5y ago

NicoJuicy 5y ago

This is a good move for TSMC. A lot of action happens through ASML ( Netherlands) and IMEC ( Belgium). Germany is relatively close to both.

xadhominemx 5y ago
Why would the locations of those research organizations matter?
- NicoJuicy 5y ago
  Because while TSMC is production, the innovation happens mostly with those companies.
  - xadhominemx 5y ago
    Ya but why does it matter that those organizations are in Europe? The distance does not matter and in any event TSMC is not contemplating building a leading edge plant in Europe
    - mqus 5y ago
      Depending on how close the interactions are, having similar timezones can be pretty important
  - MangoCoffee 5y ago
    TSMC's innovation on production is impressive as well like the on chip water cooling. https://www.extremetech.com/computing/324625-tsmc-mulls-on-chip-water-cooling-for-future-high-performance-silicon https://www.extremetech.com/computing/324625-tsmc-mulls-on-c...
    - NicoJuicy 5y ago
      3nm and the future 2nm and 1nm is all with research from Europe.

nbevans 5y ago

I find it surprising that they are choosing Germany - after everybody is seeing what Germany is doing to Tesla's Gigafactory there (embroiling it in so much red tape that Elon wishes he could pull out if it weren't for sunk cost). It seems that Germany has a very good ability to convince and lobby these mega-manufacturers to base themselves there, but a very poor ability to actually let them succeed after making that decision. TSMC would be wiser to invest in the UK - where there is a strong political will to remove barriers to entry - and it is of course where ARM are already based and therefore has a very strong overlap of skills. There is also far less likelihood of exports being restricted during a possible future crisis by the political whims of failed politicians i.e. it is a politically more stable bet.

flohofwoe 5y ago
There's a bit of a "silicon cluster" around Dresden in Germany going all the way back to the late 60s and 70s (the GDR had pretty impressive chip manufacturing capabilities for such a small country on the wrong side of the Iron Curtain). Also regarding the "red tape", this depends a lot on the state you're in. Brandenburg/Berlin vs Saxony/Thuringia/Bavaria can be very different in that regard (of course it depends a lot on the local government that's currently in place).
kall 5y ago
I think the government considers semiconductors a key industry to compete with china and I believe that matters. American electric car manufacturers on the other hand are a threat to germany's combustion obsessed car industry. I also think that Elon runs his companies in an unconventional way that maybe doesn‘t fly with german bureaucrats. TSMC will do things by the book and the saxonian government will welcome them with open arms. They won‘t see any of the local government trouble that Tesla had in Dresden.
estaseuropano 5y ago
Germany has dozens of chip manufacturers and great engineering workforce. Certainly much better than UK. Have not seen any wupte about Tesla wanting to pull out, but the factory is already half operational so seems most issues are resolved. Once located it should also be easier to do this kind of projects, but planting a new huge factory is always a challenge.

nazrulmum10 5y ago

its a great news for Germany . If TSMC located their chip plant in there.

LatteLazy 5y ago

A lot of people seem to think (high, German) Labour costs matter in this desicion. I don't think they do. If TSCM hires someone 1% better than the other guy, he makes them millions more with a better design/brighter idea etc. So paying 50% more on his salary is very affordable. That's the difference between a high tech company and amazon, Walmart etc. Germany seems like exactly the place I'd look for a highly educated workforce and one with a strong engineering culture. AND a place where workers will stay for a lifetime not just jump ship every 24months or take a fat cheque from China to move there and build them a TSCM copy. I'd be more worried about German pollution, health and safety etc laws, as this is a dirty industry. And I'd be more worried about getting a big chunk of land and planning permission.

jansan 5y ago

Also, according to article linked below (in German), Intel is considering building a semiconductor factory in Germany. The had plans in 2003, but the project failed and cost the German taxpayer a small fortune. I am very sceptical regarding the plans of Intel, but the TSMC plan sounds promising. If I were to decide, I would build a factory in Saxonia near Dresden. People there are traditionally inventive, labor costs are far lower than in the Munich region, and there is a lot of skill available due to the previous AMD investments. Link to article: https://www.berliner-zeitung.de/mensch-metropole/chipfabrik-von-intel-in-frankfurt-oder-es-geht-um-milliarden-li.162695 https://www.berliner-zeitung.de/mensch-metropole/chipfabrik-...

atc 5y ago

A UK FreePort would be far more beneficial for skill set, JIT trade and global connectivity. Plus a long way from the stranglehold of EU protectionism, red tape and corruption

polskibus 5y ago

Just recently we've discussed "faltering" talks in Europe https://news.ycombinator.com/item?id=27161217 https://news.ycombinator.com/item?id=27161217 and "eyeing" Japan https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-eyes-plans-for-first-chip-plant-in-Japan https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-ey... I wonder if this media noise is more to do with negotiation tactics than with real intentions.

shoto_io 5y ago
They gotta talk about something… and for that they need to amplify the smallest signal into a trend! I mean noise…
rossdavidh 5y ago
I think that they are, in fact, intending to open new fabs in both Japan and Europe. Given the presence of GlobalFoundries and others in Germany, that would make sense for a European base. This doesn't mean that it's not _also_ intended to help with negotiations, of course. It can be both true, and stated out loud for the purpose of seeing what other offers come up.
mm983 5y ago
they are building one in japan

gfiorav 5y ago

This is a major geopolitical decission. TSMC is responisble for 1/3 of chips worldwide (in an industry with few players). China's claim on Taiwan has a lot to do with that.

mrlonglong 5y ago

I'm not sure why they didn't consider the UK, plenty of high tech here and the Russians won't find us a walk over if they ever do come.

totalZero 5y ago
I think there are some obvious trade barriers that the British imposed upon themselves.
- mrlonglong 5y ago
  That's true that 51% voted didn't give a crap about how this will affect business and trade. Serves them right for cutting their nose to spite others. And I'm half British !

bogomipz 5y ago

I was curious about this statement: >"TSMC supplies chips to almost all the key global chip developers, from Apple, Qualcomm and Advanced Microelectronics Devices to Intel, Infineon and Sony." When exactly did Intel become a customer of TSMC? Is this for a recent process technology or is this only for specific types of chips? I under the impression Intel chips always came from their own fabs.

jhickok 5y ago
https://asia.nikkei.com/Business/Tech/Semiconductors/Apple-and-Intel-become-first-to-adopt-TSMC-s-latest-chip-tech https://asia.nikkei.com/Business/Tech/Semiconductors/Apple-a...
totalZero 5y ago
Intel has been a customer of TSMC on the small-time stuff for a while now, if you consider the fact that they acquire companies that do business with TSMC (including Altera). However, the leading-edge customer relationship is very new[0]. I read it as a form of defense against AMD in the short term (pricing power and availability) and against Apple in the long term (x86 vs Apple Silicon). [0] https://www.tomshardware.com/news/intel-to-outsource-some-key-cpu-production-for-2023-chips https://www.tomshardware.com/news/intel-to-outsource-some-ke...
aryonoco 5y ago
Intel has been a TSMC client for many years. Not for their CPUs but for many of the multitude of other chips that Intel produces, from NICs to Wifi chips. Current estimates is that 7.2% of TSMC's revenue comes from Intel, which makes Intel TSMC'S 6th biggest client, only marginally behind AMD (9.2%) https://seekingalpha.com/article/4414346-samsung-won-t-soon-overtake-taiwan-semi-despite-massive-capex-spend https://seekingalpha.com/article/4414346-samsung-won-t-soon-...

varispeed 5y ago

From a security point of view, it's interesting that they don't look to build a fab in the UK. Given that the Europe used to be an arena of devastating conflicts - with things like completely levelled down cities, to murders on an industrial scale, the long term investment like this may be subject to a lot of uncertainty as the EU moves closer towards being an authoritarian regime, this may wake up internal conflicts that are deeply embedded in some of the nations.

dangerface 5y ago
The last European war was over 70 years ago and today it is one of if not the most stable regions in the world. The idea that they are doom spiralling into authoritarianism is a conspiracy theory that is easy to dismiss.
- varispeed 5y ago
  Were you born yesterday? https://en.wikipedia.org/wiki/List_of_conflicts_in_Europe#Ongoing_conflicts https://en.wikipedia.org/wiki/List_of_conflicts_in_Europe#On...
  - dangerface 5y ago
    Did you even look at your link? 5 Eastern bloc countries having independent wars with the USSR in the 80s is hardly a current arena of conflict, weak. Obviously the middle east or the americas would be a better location, I'm joking obviously. https://en.wikipedia.org/wiki/List_of_modern_conflicts_in_the_Middle_East https://en.wikipedia.org/wiki/List_of_modern_conflicts_in_th...

pomian 5y ago

I'm wondering about Italy. They have an established industrial base. They manufacture a surprising amount of high tech, but don't brag about it like Germany. Many good European neighbours to provide a broad range of skilled workers and researchers.

username90 5y ago
Italy is tech hostile like most of southern Europe, engineers are paid horribly compared to other professions so they usually leave north.

sativallday 5y ago

This feel like corporate geopolitical diplomacy.

flavius29663 5y ago
It sure does, the EU announces they're going to invest X tens of billions in chips, and the next thing you know, the largest backer and beneficiary of EU gets this new factory.
eruleman 5y ago
Yup! My favorite Stratechery post is on this very topic, Chips and Geopolitics: https://stratechery.com/2020/chips-and-geopolitics/ https://stratechery.com/2020/chips-and-geopolitics/

poxwole 5y ago

I hope the German ans EU labour laws atleast make the working conditions bearable. Working at TSMC is hellish. I worked as a tool vendor. It was crazy.

cbmuser 5y ago

Germany has the highest electricity prices worldwide. I wouldn’t build any larger factory there these days: > https://www.statista.com/statistics/263492/electricity-prices-in-selected-countries/ https://www.statista.com/statistics/263492/electricity-price...

geff82 5y ago
Energy hungry industries don't have to pay all the energy taxes+fees. For them, Germany is a rather cheap place to be.

pomian 5y ago

Europe has so many great countries. Street reading the comments about Germany and it's internal policies, why not choose elsewhere? Finland, Sweden, Poland, etc etc etc

paxys 5y ago
What policies? Germany is many notches above the rest of the EU when it comes to manufacturing infrastructure and labor force. It's the obvious choice for such a large scale and expensive setup.

Havoc 5y ago

It does make some sort of sense if you're trying to stay clear of the US/China catfight & EU is not a bad place to start in that regard. Plus it ticks the box of EU origin, which is interesting in itself if you want to expand there.

nsonha 5y ago

not really related but I found this really interesting channel with many TSMC/Taiwan/semiconducting related video, as well as asian geopolitics if you're into that https://www.youtube.com/watch?v=oAlU6vQ1Pn8 https://www.youtube.com/watch?v=oAlU6vQ1Pn8

deleted 5y ago

[deleted]

lonelyasacloud 5y ago

Bad news for Taiwan. The more that's moved off the island the less the West is going to feel compelled to defend it.

greeee32 5y ago

EU has too much bureaucracy, taxes and it's just not a good place to do a business.

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