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If Taiwan is taken off the board for semiconductors, or if all semiconductors have to go through China, that means the entire US military (and all western milit

by nscalf 4y ago

If Taiwan is taken off the board for semiconductors, or if all semiconductors have to go through China, that means the entire US military (and all western militaries) are dependent on a geopolitical rival. To allow that would be nothing short of giving away the game.

patmorgan23 4y ago
There are advanced Fabs in Israel, Intel and TSMC are both building next gen Fabs in Arizona. It's not like Twain is the only place with advanced chip fabs(though yes the vast majority of the capacity is there and IIRC thats where their latest process nodes are but I don't think the military is dependent on those absolute cutting edge process nodes)
- heavyset_go 4y ago
  Those fabs won't start producing for years.
- ElevenLathe 4y ago
  Taiwan is also the center of a lot of specialist equipment (not the big swiss-watch ASML machines, but stuff like wafer transports, cleanroom gear, etc.) and consumables (chemicals, bunny suits, etc.). I don't know how extensive and fragile that ecosystem is but I live in eastern Michigan and it seems like every small to midsize town has some tiny automotive supplier that is somehow still in business even while the big plants have moved on. I suspect this is largely because they have no competitors and it is specialist work that doesn't really scale (meaning there is only so much of this work to go around, even if global auto sales 10x) so no one is really motivated to compete either. The result is that the GM and Ford plants leave the country, but still rely on a relatively small set of expertise and tooling that only exist in the rust belt. Presumably, a thorough nuking of the Midwest would (in addition to lots of other unpleasant effects, like the death and famine millions, perhaps billions) at least require the pause of the majority of auto manufacturing around the globe. Assuming people still wanted cars after such an event, it could be recovered, but it would take time. I got a little carried away with the Michigan analogy, but IMO it doesn't go far enough: Taiwan is far more integral to the global semiconductor industry than Detroit is to the global auto industry.
- nscalf 4y ago
  I agree that this isn't an indefinite problem, but the current state of affairs is that TSMC is irreplaceable on the world's fabrication scene. The military definitely has some need for cutting edge process nodes, though I can't say how much. This is intentionally vague, but it seems safe to say there are a number of high end missile guidance systems, a variety of AI implementations, and drone systems that likely all have some dependence on high end chips. Not to mention the economic reliance on TSMC, Apple alone is ~7% of the S&P500. I think if we fast forward 5-10 years, Taiwan will not be this much of an absolute, but it will take years for these new fabs to come online. Until there are viable alternatives, Taiwan is a massive risk.
patentatt 4y ago
This is what I don't get. I thought military and aerospace used decades old cpu designs on decades old fab technology for the radiation hardness? Not saying they couldn't benefit from an upgrade, but it's not like Lockheed is putting Nvidia GPUs in fighter jets, right? It doesn't seem like a deal breaker to use a 14nm node compared to a '5nm' node (or whatever is the latest TSMC process). Seems like a weird line to draw in the sand to me. Frankly, seems like the only applications which are make or break on EUV lithography are all gaming related. Am I that off base here? Certainly prices would rise, and critical supply chains would have to be remade, and there would be no more iPhones, but seems like we'd get by just fine for a few years before catching back up and then likely surpassing Taiwan. And it's not like the real brains behind TSMC would willingly help a Chinese controlled takeover, and add on a new layer of corruption and bureaucracy, and in a few years TSMC is irrelevant anyways. And don't forget, TSMC is reliant on ASML, who certainly wouldn't be shipping any more EUV lithography equipment to a Chinese controlled Taiwan.
- nscalf 4y ago
  I think that's true for some key components of the military, but for example, anything involving AI systems necessitate cutting edge chips. You can probably look to the effect chip shortages had on car manufacturers to see how much of this likely works. Cars manufacturing wasn't entirely halted in most cases, instead they had downgraded functionality. Less automatic windows, more window cranks. The totality of every military system isn't based off high end chips, but some of it certainly is.
- deleted 4y ago
  [deleted]
JAlexoid 4y ago
That's complete BS. If TSMC is removed - we don't loose ALL of it. Taiwan and China account for 70% of contract chip manufacturing. It's absolutely the dominant share... but not remotely to being "all".

by nscalf 4y ago

patmorgan23 4y ago

There are advanced Fabs in Israel, Intel and TSMC are both building next gen Fabs in Arizona. It's not like Twain is the only place with advanced chip fabs(though yes the vast majority of the capacity is there and IIRC thats where their latest process nodes are but I don't think the military is dependent on those absolute cutting edge process nodes)

heavyset_go 4y ago
Those fabs won't start producing for years.
ElevenLathe 4y ago
Taiwan is also the center of a lot of specialist equipment (not the big swiss-watch ASML machines, but stuff like wafer transports, cleanroom gear, etc.) and consumables (chemicals, bunny suits, etc.). I don't know how extensive and fragile that ecosystem is but I live in eastern Michigan and it seems like every small to midsize town has some tiny automotive supplier that is somehow still in business even while the big plants have moved on. I suspect this is largely because they have no competitors and it is specialist work that doesn't really scale (meaning there is only so much of this work to go around, even if global auto sales 10x) so no one is really motivated to compete either. The result is that the GM and Ford plants leave the country, but still rely on a relatively small set of expertise and tooling that only exist in the rust belt. Presumably, a thorough nuking of the Midwest would (in addition to lots of other unpleasant effects, like the death and famine millions, perhaps billions) at least require the pause of the majority of auto manufacturing around the globe. Assuming people still wanted cars after such an event, it could be recovered, but it would take time. I got a little carried away with the Michigan analogy, but IMO it doesn't go far enough: Taiwan is far more integral to the global semiconductor industry than Detroit is to the global auto industry.
nscalf 4y ago
I agree that this isn't an indefinite problem, but the current state of affairs is that TSMC is irreplaceable on the world's fabrication scene. The military definitely has some need for cutting edge process nodes, though I can't say how much. This is intentionally vague, but it seems safe to say there are a number of high end missile guidance systems, a variety of AI implementations, and drone systems that likely all have some dependence on high end chips. Not to mention the economic reliance on TSMC, Apple alone is ~7% of the S&P500. I think if we fast forward 5-10 years, Taiwan will not be this much of an absolute, but it will take years for these new fabs to come online. Until there are viable alternatives, Taiwan is a massive risk.

patentatt 4y ago

This is what I don't get. I thought military and aerospace used decades old cpu designs on decades old fab technology for the radiation hardness? Not saying they couldn't benefit from an upgrade, but it's not like Lockheed is putting Nvidia GPUs in fighter jets, right? It doesn't seem like a deal breaker to use a 14nm node compared to a '5nm' node (or whatever is the latest TSMC process). Seems like a weird line to draw in the sand to me. Frankly, seems like the only applications which are make or break on EUV lithography are all gaming related. Am I that off base here? Certainly prices would rise, and critical supply chains would have to be remade, and there would be no more iPhones, but seems like we'd get by just fine for a few years before catching back up and then likely surpassing Taiwan. And it's not like the real brains behind TSMC would willingly help a Chinese controlled takeover, and add on a new layer of corruption and bureaucracy, and in a few years TSMC is irrelevant anyways. And don't forget, TSMC is reliant on ASML, who certainly wouldn't be shipping any more EUV lithography equipment to a Chinese controlled Taiwan.

nscalf 4y ago
I think that's true for some key components of the military, but for example, anything involving AI systems necessitate cutting edge chips. You can probably look to the effect chip shortages had on car manufacturers to see how much of this likely works. Cars manufacturing wasn't entirely halted in most cases, instead they had downgraded functionality. Less automatic windows, more window cranks. The totality of every military system isn't based off high end chips, but some of it certainly is.
deleted 4y ago
[deleted]

JAlexoid 4y ago

That's complete BS. If TSMC is removed - we don't loose ALL of it. Taiwan and China account for 70% of contract chip manufacturing. It's absolutely the dominant share... but not remotely to being "all".