9 ms·
Wonder if the Taiwanese govt at some point will step in and block these onshoring measures as a matter of national security. If countries are less reliant on m
by sirius87 3y ago
Wonder if the Taiwanese govt at some point will step in and block these onshoring measures as a matter of national security.
If countries are less reliant on manufacturing within Taiwan, its one less reason to stand up to Beijing's one China principle.
- JumpCrisscross 3y agoYou don’t see how that would immediately produce blowback? Is Congress going to say “oh shucks” and authorise another weapons deal? Or might they redirect those dollars domestically while reducing patrols of the Taiwan Straits?
- sealeck 3y agoIt's extremely unlikely for the US to do that as if China takes Taiwan it will be a huge blow to the US and to the value of being a US ally.
- andrewstuart 3y agoThey probably figure it’s better to be the one doing it than someone else.
- christkv 3y agoA much better strategy is to work slow :). Drag out every phase.
- christkv 3y agoAlso ASML has a super long backlog I think so even if they build it they would have years to wait to even get and install the equipment
- thiago_fm 3y agoMore like the opposite, by making ties with other countries, Taiwan will win some geopolitical points. TSMC alone has no control over if the Chinese government will commit such aggression, if they would do their whole company strategy based on fearing the CCP, there's no way they can be successful.
- arlcode 3y agoI think this is true. China is working really hard to get it's domestic semiconducter industry up to speed. They are willing to burn a lot of money and time to reach their overall political goal of annexing Taiwan even if it takes a very very long time. Ultimately it's unrealistic to assume that a country of 1.4 Billion people can not catch up eventually espescially if they would otherwise have to rely on a global competitor (US) or a military target which factories are rigged to blow (Taiwan). The best thing Taiwan can do (once their semiconductor lead is no more) is to make themselves into a strategic ally located on Chinas doorstep.
- JumpCrisscross 3y ago> it's unrealistic to assume that a country of 1.4 Billion people can not catch up eventually Why? By 2100, each of Pakistan, the D.R.C. and Kenya are forecast to have larger populations than America [1]. Is it unrealistic to assume they won’t be at parity with the west in eighty years? (Note: not saying dismiss entirely. Just baselines.) China has a lot going for it in semiconductors. Demography isn’t one of them. The population is aging and shrinking. That, ceteris paribus, reduces surplus capital for R&D. [1] https://en.wikipedia.org/wiki/Projections_of_population_growth https://en.wikipedia.org/wiki/Projections_of_population_grow...
- mschuster91 3y ago> By 2100, each of Pakistan, the D.R.C. and Kenya are forecast to have larger populations than America. Is it unrealistic to assume they won’t be at parity with the west in eighty years? Pakistan has the best chances to rise, at least assuming religious / ethnic tensions can be somewhat placated, it doesn't become a hotbed of natural disasters like last year's floods and they don't either get into open war with India or suffer from some sort of coups by the military or secret services. Kenya and especially Congo? That's a different game entirely. Climate change, utter poverty and endemic corruption are just a couple of the hurdles to pass.
- guiriduro 3y ago
- crote 3y agoNot for this fab. The technology is quite old, so it doesn't directly change anything about our reliance on Taiwan's cutting-edge fabs.
- junon 3y agoCouldn't TSMC cease or hinder operations if their HQs is threatened and their partnering countries do nothing? Seems like more leverage and ally building than the opposite to me.
- rsynnott 3y agoTSMC is a big buyer of fab equipment from European and US companies; that could quickly become a _very_ ugly trade war.
- DrBazza 3y agoTSMC buy the fab equipment ASML based in the Netherlands.
- throw0101b 3y agoNL could block it on national security grounds.
- mytailorisrich 3y agoDepends on what the US tell NL to do, as we've seen before.
- KingOfCoders 3y agoThese days are over - they ended with the war in Iraq. In the 80s the US said "Jump!" and western Europe asked "How high?".
- christkv 3y agoEurope is still doing it, and when they don’t the us applies pressure through its closest European Allies. The us is very much still involved in classic Cold War stuff in Europe. The Ukrainian war has been very good to American exports of arms and liquid gas.
- AlchemistCamp 3y ago> The Ukrainian war has been very good to American exports of arms By "exports", do you mean donations? https://www.bbc.com/news/world-us-canada-64656301 https://www.bbc.com/news/world-us-canada-64656301
- the-dude 3y agoIt is still exported, right? Calling it a donation does not suddenly make the arms free/gratis. The money still comes from somewhere and is ... exported.
- rjzzleep 3y agoPeople who don't understand what OP just wrote should look at what just happened to the South Korean semiconductor market. over 36% plunge in exports[] and that samsungs memory profit dropped 95%[]. Yes, they depend on ASML, but ASML itself was dependent on IP from TSMC engineers. TSMC already announced that they will stop applying for subsidies from the Chip Act[] in the US recently because the US keeps changing what confidential data needs to be shared with the US. They seem to be at least slowly understanding that this is a dangerous game. And for the people that keep talking about ASML you might well want to remember that not long ago the leadership was mocking China's capability to build their own domenstic supply chain only to flipflop shortly after saying that it would be foolish to abandon the Chinese market likely indicating that they might be concerned that their domestic supply chain might end show up faster than expected. Taiwanese media last year was plastered with news about how the US hollowed out the Japanese semiconductor industry with its agreement in 1986 and how that will be potentially the fate of Taiwan. But the sibling comments are correct about the potential blowback, let's not forget that the US has been talking about bombing TSMC themselves[]. I guess that probably explains why they just announced a delay to the construction of the Arizona fab. [] https://www.koreatechtoday.com/south-koreas-semiconductor-exports-sink-by-36-2-percent-in-may/ https://www.koreatechtoday.com/south-koreas-semiconductor-ex... [] https://www.aljazeera.com/economy/2023/7/27/samsungs-profit-plunges-95-percent-on-weak-memory-chip-demand https://www.aljazeera.com/economy/2023/7/27/samsungs-profit-... [] https://www.theregister.com/2023/04/11/tsmc_chips_act/ https://www.theregister.com/2023/04/11/tsmc_chips_act/ [] https://www.taiwannews.com.tw/en/news/4886681 https://www.taiwannews.com.tw/en/news/4886681
- JumpCrisscross 3y ago> the US has been talking about bombing TSMC themselves[] The U.S. said nothing of the sort. One Congressman, in the minority no less, did.
- colechristensen 3y agoOf course there is a plan somewhere for this kind of thing, that's how war works. But an idiot fringe congressman spouting such things does not make a credible threat or say anything about the actual intentions about the country, just a good way for somebody to get attention or some points from one hardline group or another.
- mensetmanusman 3y agoOnshoring is impossible for most countries. TSMC had an annual capital budget of >$50B, there are only like 30 countries with >$100B in total government revenue: https://en.m.wikipedia.org/wiki/List_of_countries_by_government_budget https://en.m.wikipedia.org/wiki/List_of_countries_by_governm...
- coliveira 3y agoThe USA has guaranteed the demise of Taiwan by making it the next target of a global war. Everyone knows that China is not going back on a territory that is theirs by international treaties, and the US has practically declared they will fight to separate Taiwan from China. The only thing that remains for Taiwanese companies is to move from homeland into other countries as a way to survive. Actually, this is probably what the US gov wanted in the first place, so they destroyed another competitor.
- brobinson 3y ago"that is theirs by international treaties" The PRC has never, not even for a single day, controlled Taiwan, Kinmen, Matsu, etc. The continued existence of the ROC (1912-present) truly causes tankies to lose their minds.
- t43562 3y agoTo make Taiwan less critical makes it less attractive as a target - China won't be able to damage the US so much by taking Taiwan. It will be harder for China to force other people to accept their action.
- coliveira 3y agoThis doesn't make Taiwan less critical for China. They will continue to defend Taiwan as part of China for the foreseeable future.
- t43562 3y agoNot less critical but you see if they steal something the rest of the world needs then they can hold the world to ransom but if the rest of the world has alternatives then they can't. That has to change their calculations about when and how they will make a move.
- coliveira 3y agoWhy do you think Taiwan reuniting with China would steal anything from the rest of the world? Nothing in Taiwan is owned by the rest of the world, Taiwan itself owns what they have. And the Chinese government will not stop selling what Taiwan produces.
- toss1 3y agoIt is not just Taiwan's advanced manufacturing that is critical to the free world — an enormous amount of shipping for Japan also goes through the Straits Of Taiwan. This is just part of the reason that the US Navy frequently runs freedom of navigation exercises through those waters. Mere reduction of the criticality of Taiwan's advanced manufacturing will not eliminate Taiwan's geostrategic importance. Plus, the CCP's insistence on being an expansionist authoritarian state is reason enough to contain that expansion, to prevent further resource gains.
- mordae 3y agoSo far they don't feel that expansionist. More likely they just don't want US to be able to cut them off from the rest of the world by naval blockade.
- toss1 3y ago"don't feel that expansionist"?!? Sure, if you ignore their military actions and treaty violations in Tibet, Turkistan (Uyghurs), border conflicts around the Himalyas and India, Russia (border conflict), Korea, Vietnam, everywhere on the "9-dash line", Canada and the US (where they are putting up remote "police stations" to intimidate anyone expressing opinions they dislike)... CCP has a highly consistent history of being as aggressive and untrustworthy as they can get away with. Anyone trusting them is a fool.
- UncleOxidant 3y agoHaving so much reliance on advanced semiconductors from an island that's potentially going to be invaded by China doesn't seem like a great plan for the US and Europe. It absolutely makes sense for both the US and Europe to incentivize production in their own countries to diversify. If the fabs in Taiwan were to be damaged without building up this domestic capability we'd have a tough time defending Taiwan after a while anyway.
- sergiotapia 3y agoIt's game theory no? Having this beefy reliance on a small island that gives china the middle finger -OR- derisk the reliance on taiwan
- tetha 3y agoI don't think it's that simple, because the effort necessary to employ the different choices are very different. Stopping cargo going out of Taiwan is rather cheap. Unguided rockets and aircraft from your homeland can do a lot. And then they just have to defend near their home land while waiting for their opponent to run out of resources. At the same time, as we can see here, it takes 4 years to go from acre to functional fab plant after planning and negotiations. And any kind of war to regain control of the chip supply lane is a significant drain on the chips and systems reliant on the chips you have.
- ironborn123 3y agoYes but both sides can play the game of blocking cargo. Malacca strait comes to mind.
- madsbuch 3y agoMy impression is that TSMC is a Taiwanese company, why this would not be onshoring, but offshoring. The more appropriate term is probably foreign direct investment (FDI) in Germany from TSMC. I find it funny that western people have issue with the idea that Asian companies can indeed also invest in western countries. It is akin to some discussion about Lega here on HN where some people talked about it as "onshoring" when they made a US factory – Lego is a Danish comapny.
- nabla9 3y agoTSMC is not building GIGAFAB outside Taiwan. This in Germany and the one in the US are both Megafabs.They produce chips for special industries with strategic importance. In the US for military and defense, in the Europe for automotive industry and automation.
- mrweasel 3y agoThese fabs are going to be built, with or without TSMC. I do have a bit more confidence in the long term success of US fabs, compared to the EU one, but there's a good chance that both will succeed, to some extend. The Taiwanese government can attempt to prevent TSMC in participating, but what good will that do? Might as well ensure that TSMC at least have a hand in it and avoid customers leaving for another manufacturer. TSMC can then offer fabrication, maybe it's in the EU, maybe it's in Taiwan, the important part is keeping the customer and not allowing competitors to establish themselves.
- 01100011 3y agoI'm wondering if these offshore fab announcements from TSMC are more like unserious offers intended to delay other countries from pushing harder to establish local semiconductor industries. TSMC is already delaying the Arizona plant in the US. Maybe that was their intent from the beginning? "But they've spent X billions of dollars." Yes but this is irrelevant when facing off an existential threat to their business and the overall economy and security of Taiwan. Taiwan, like Israel, is run by cunning folks. They wouldn't have survived this long otherwise.
- YetAnotherNick 3y agoWe are talking about potential WW3, and you are worried about world loosing 2 years of progress due to war. Currently, Samsung is 2-3 years behind and Intel is 3-4 years behind and the gap is shrinking as we approach EUV limit. Millions of lives would be lost if not more if it will be a full scale war. A chip fab is nowhere the same level of importance to be even discussed on the table.