4 ms·

Let me know when they actually break ground and start building one :-). I fully support TSMC's efforts to diversify the jurisdictions that have semi-conductor

Let me know when they actually break ground and start building one :-). I fully support TSMC's efforts to diversify the jurisdictions that have semi-conductor fabs though. That is a huge win for them and makes the Chinese mainland threat to assimilate Taiwan less? More fab capacity is a win.

jonplackett 5y ago
So what actually happens to fabs outside of Taiwan if China do take Taiwan and presumably also TSMC the company.
- chaostheory 5y ago
  Good question, but we'll probably have bigger problems, like a potential hot war, if that happens. How these problems get resolved ie "who wins" is the answer to what happens to TSMC.
- ChuckMcM 5y ago
  Really good question. I don't know. What I would do if I were leading TSMC is create a wholly owned subsidiary which held all of the non-Chinese assets and headquarter it in a tax neutral country like the Netherlands. Let's call it TSMC International. Then in the event of an assimilation by China, sell all of the assets that TSMC the parent company owns, to TSMC-i for $1 or something. And in fact have the paper work at the TSMC-i headquarters all filled out just waiting for being dated and executed by TSMC-i executives. It is a variation on a poison pill defense.
- i21QMgplhRJs2OL 5y ago
  Something like what happened with Arm China. https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...
  - mianos 5y ago
    p.sm this was retracted. The new company is specifically specialising in extensions and add-ons. Or that was what they were told to re-write.
    - ksec 5y ago
      >Or that was what they were told to re-write. Especially when they are in the middle of going thought M&A. Along with trying not to anger China which could retaliate.
- deaddodo 5y ago
  Theoretically; something similar to what happened to the Cuban cigar producers after the revolution. They spin off into their own company/companies no longer recognizing the “invalidated” company charter. But, realistically, China will press their global influence to keep them under Sino-TSMC’s control under a new Chinese corporate charter.
  - NineStarPoint 5y ago
    It will depend heavily on the amount of global sway China has at that point. I imagine the countries TSMC builds the fabs in would vastly prefer to use the invasion as an excuse to say the fabs belong under the control of a entity without connections to China.
- protomyth 5y ago
  I think the going in position is that the fabs in Taiwan are not going to exist if China takes the island, so the only fab business will be outside fabs. I assume they have a continuity plan for one of the other offices to become the new HQ https://www.tsmc.com/english/aboutTSMC/business_contacts https://www.tsmc.com/english/aboutTSMC/business_contacts
- stale2002 5y ago
  Well one possibility is that those fabs will simply be nationalized by the country that they are in. That would be an effective economic retaliation against a country that invades someone else like that.
- Bayart 5y ago
  They'll be spun off into different companies. That's usually what happens when multinationals get cut across by war.
dirtyid 5y ago
>That is a huge win for them and makes the Chinese mainland threat to assimilate Taiwan less? More fab capacity is a win. No the opposite, TW is giving up their silicon shield due to pressure from various blocs. The chief global interest in defending TW evaporates and PRC calculus for reunification increases when enough critical semi productions moves off island. DPP / TW has been balancing a tight rope of placating demands for TSMC fabs outside of east asia and trying to trade it for some geopolitical wins. But really TSMC and TW has no choice, EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on, the carrots of subsidies and temporary positive geopolitical messaging around TW recently are consolation prizes. I think TW hopes naively if they spread TSMC supply chain in enough countries, it would increase mutual dependancy and security. Instead, in scenario of PRC reunifying forcefully, host countries will just nationalize TSMC fabs on their soil. The entire point of TW's silicon shield is to concentrate fabs on TW to sustain uneasy detente. The more production moves off island the more opportunities for global demand to factor out TW fabs... which unlike Japan, Korea, NATO countries where new fabs are being proposed, explicitly does not have US security guarantee, i.e. TW fabs will become the most vunerable suppliers. This point is key. For PRC, having critical fabs concentrated on TW is a geopolitical gift, even if US can leverage them in peace time via sanctions, PRC can leverage them more during war time via disruption. Everyone knows this, no one will want to depend on TW fabs once suppliers on secure soil are established. TSMC / TW writing their suicide letter. I anticipate TSMC will do everything it can to delay these projects to buy more time.
- MrBuddyCasino 5y ago
  I wonder what the situation with production capacity is. I suspect TSMC will build a fab here and there that might suffice to make enough to supply the military, but not for anything else. Large sectors of the economy would still be cut off from chip supply, and we've seen how that went with the car industry. If PRC would conquer TW, they would not have an incentive to stop chip exports I think. Too much mutual dependency with the trade partners, and the party does not like domestic instability - unemployment would be unwelcome. Would TW blow up the factories though? It is said they can do this with a press of a button. > EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on Wouldn't that be self-sabotage? TSMC is in the strong position, everyone wants capacity, they have it. Intel and Samsung can't compete on the latest nodes.

jonplackett 5y ago

So what actually happens to fabs outside of Taiwan if China do take Taiwan and presumably also TSMC the company.

chaostheory 5y ago
Good question, but we'll probably have bigger problems, like a potential hot war, if that happens. How these problems get resolved ie "who wins" is the answer to what happens to TSMC.
ChuckMcM 5y ago
Really good question. I don't know. What I would do if I were leading TSMC is create a wholly owned subsidiary which held all of the non-Chinese assets and headquarter it in a tax neutral country like the Netherlands. Let's call it TSMC International. Then in the event of an assimilation by China, sell all of the assets that TSMC the parent company owns, to TSMC-i for $1 or something. And in fact have the paper work at the TSMC-i headquarters all filled out just waiting for being dated and executed by TSMC-i executives. It is a variation on a poison pill defense.
i21QMgplhRJs2OL 5y ago
Something like what happened with Arm China. https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...
- mianos 5y ago
  p.sm this was retracted. The new company is specifically specialising in extensions and add-ons. Or that was what they were told to re-write.
  - ksec 5y ago
    >Or that was what they were told to re-write. Especially when they are in the middle of going thought M&A. Along with trying not to anger China which could retaliate.
deaddodo 5y ago
Theoretically; something similar to what happened to the Cuban cigar producers after the revolution. They spin off into their own company/companies no longer recognizing the “invalidated” company charter. But, realistically, China will press their global influence to keep them under Sino-TSMC’s control under a new Chinese corporate charter.
- NineStarPoint 5y ago
  It will depend heavily on the amount of global sway China has at that point. I imagine the countries TSMC builds the fabs in would vastly prefer to use the invasion as an excuse to say the fabs belong under the control of a entity without connections to China.
protomyth 5y ago
I think the going in position is that the fabs in Taiwan are not going to exist if China takes the island, so the only fab business will be outside fabs. I assume they have a continuity plan for one of the other offices to become the new HQ https://www.tsmc.com/english/aboutTSMC/business_contacts https://www.tsmc.com/english/aboutTSMC/business_contacts
stale2002 5y ago
Well one possibility is that those fabs will simply be nationalized by the country that they are in. That would be an effective economic retaliation against a country that invades someone else like that.
Bayart 5y ago
They'll be spun off into different companies. That's usually what happens when multinationals get cut across by war.

dirtyid 5y ago

>That is a huge win for them and makes the Chinese mainland threat to assimilate Taiwan less? More fab capacity is a win. No the opposite, TW is giving up their silicon shield due to pressure from various blocs. The chief global interest in defending TW evaporates and PRC calculus for reunification increases when enough critical semi productions moves off island. DPP / TW has been balancing a tight rope of placating demands for TSMC fabs outside of east asia and trying to trade it for some geopolitical wins. But really TSMC and TW has no choice, EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on, the carrots of subsidies and temporary positive geopolitical messaging around TW recently are consolation prizes. I think TW hopes naively if they spread TSMC supply chain in enough countries, it would increase mutual dependancy and security. Instead, in scenario of PRC reunifying forcefully, host countries will just nationalize TSMC fabs on their soil. The entire point of TW's silicon shield is to concentrate fabs on TW to sustain uneasy detente. The more production moves off island the more opportunities for global demand to factor out TW fabs... which unlike Japan, Korea, NATO countries where new fabs are being proposed, explicitly does not have US security guarantee, i.e. TW fabs will become the most vunerable suppliers. This point is key. For PRC, having critical fabs concentrated on TW is a geopolitical gift, even if US can leverage them in peace time via sanctions, PRC can leverage them more during war time via disruption. Everyone knows this, no one will want to depend on TW fabs once suppliers on secure soil are established. TSMC / TW writing their suicide letter. I anticipate TSMC will do everything it can to delay these projects to buy more time.

MrBuddyCasino 5y ago
I wonder what the situation with production capacity is. I suspect TSMC will build a fab here and there that might suffice to make enough to supply the military, but not for anything else. Large sectors of the economy would still be cut off from chip supply, and we've seen how that went with the car industry. If PRC would conquer TW, they would not have an incentive to stop chip exports I think. Too much mutual dependency with the trade partners, and the party does not like domestic instability - unemployment would be unwelcome. Would TW blow up the factories though? It is said they can do this with a press of a button. > EU/US/JP all have sticks like tech sanctions of supply chains TSMC relies on Wouldn't that be self-sabotage? TSMC is in the strong position, everyone wants capacity, they have it. Intel and Samsung can't compete on the latest nodes.