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I don't know why analysis like this doesn't go a bit deeper. Yes americans will pay more, but TSMC will also see less demand. Intel has it's own foundry, maybe

I don't know why analysis like this doesn't go a bit deeper. Yes americans will pay more, but TSMC will also see less demand. Intel has it's own foundry, maybe it can start competing against TSMC, because now TSMC costs a lot more and intel's cost of manufacturing in the US to compete against TSMC can be recouped much better thanks to the new market prices set by the TSMC tariffs? Government's shouldn't put up with monopolies either, if it wasn't for trump's political baggage, HN would be all over this I'm sure, TSMC is already investing on US factories which even without purchasing a share of intel, it would force them to use those factories and bring them online sooner. We've had multiple unfortunate wars due to dependence on foreign resources that don't have good/sufficient competition state-side, that is not a good pattern to repeat. If TSMC doesn't blink, maybe they'll get their way for now but all their American projects and in general doing business in the US will be unpleasant and costly until 2028+. Which is cheaper? I don't know, I'm asking because a lot of opinion on the subject isn't talking/explaining about the actual numbers and nuanced economic considerations.

ExoticPearTree 1y ago
I think the problem with Intel's foundry is that it cannot produce the same quality and quantity at the level of TSMC. I was looking through the list of fabrication technology for the latest CPUs, and while they say they are 3nm, it is using TSMCs technology (Arrow Lake S: Fabrication process: Compute Tile (Contains the CPU cores) TSMC's N3B node.) My guess is that Trump is trying to save Intel by forcing TSMC to buy them under the guise of "I'm forcing companies invest in the US".
mallets 1y ago
It doesn't work if you don't have 1:1 product, which Intel foundry absolutely doesn't. Not in performance, price or just ease of use. No one is going to risk years and billions to get it working on Intel, that's a sure way to lose your edge. Companies (like Nvidia) will just raise prices and if demand drops they will divert more of it to countries like China and EU. And demand isn't going to drop much anyway for in-demand stuff like Apple chips or AI stuff. Best case scenario, they (not TSMC) temporarily eat the cost or spread it around. This has nothing to do with Trump, it simply doesn't result in competitive local manufacturing. Increasingly rent-seeking AND subsidized, with no pressure to compete.
- notepad0x90 1y ago
  You didn't address the fact that they have state-side facilities slated to open in 2026? You also said intel "doesn't" not "can't" isn't it more reasonable that demand will force supply to adapt. Why couldn't intel compete before? and why can't it going forward? China is working on TSMC rivals (if they haven't succeeded already), the west should just sit on its hands and wait for a military conflict with china because of TSMC dependence? in the short term you're right, but change is long due.
  - mallets 1y ago
    Their US facilities are purposefully NOT bleeding-edge, and also cost more. And this version of Intel can't, maybe a different one that fully separates design and foundry could. The best solution long-term would be to directly subsidize foundries, with the right incentives to acquire different customers (how TSMC or Samsung operate). They just might get lucky if everyone hits a hard scaling wall. Whatever happens, tariffs and bans are the absolute worst incentives for innovation and growth.
- croemer 1y ago
  Monopolists or companies with some degree of Monopoly will absorb some of the tariffs as opposed to passing on. Putting tariffs on monopolists makes some economic sense. Tariffs on commodities though don't.
  - mallets 1y ago
    Monopolies with strong demand for their products will happily pass on the costs, and then some. The delicate balance between encouraging demand while maintaining margins. On the political side of things, they can use their influence and customer base to pressure the government. Silently eating the costs isn't good for them or the market as a whole, long-term.

ExoticPearTree 1y ago

I think the problem with Intel's foundry is that it cannot produce the same quality and quantity at the level of TSMC. I was looking through the list of fabrication technology for the latest CPUs, and while they say they are 3nm, it is using TSMCs technology (Arrow Lake S: Fabrication process: Compute Tile (Contains the CPU cores) TSMC's N3B node.) My guess is that Trump is trying to save Intel by forcing TSMC to buy them under the guise of "I'm forcing companies invest in the US".

mallets 1y ago

It doesn't work if you don't have 1:1 product, which Intel foundry absolutely doesn't. Not in performance, price or just ease of use. No one is going to risk years and billions to get it working on Intel, that's a sure way to lose your edge. Companies (like Nvidia) will just raise prices and if demand drops they will divert more of it to countries like China and EU. And demand isn't going to drop much anyway for in-demand stuff like Apple chips or AI stuff. Best case scenario, they (not TSMC) temporarily eat the cost or spread it around. This has nothing to do with Trump, it simply doesn't result in competitive local manufacturing. Increasingly rent-seeking AND subsidized, with no pressure to compete.

notepad0x90 1y ago
You didn't address the fact that they have state-side facilities slated to open in 2026? You also said intel "doesn't" not "can't" isn't it more reasonable that demand will force supply to adapt. Why couldn't intel compete before? and why can't it going forward? China is working on TSMC rivals (if they haven't succeeded already), the west should just sit on its hands and wait for a military conflict with china because of TSMC dependence? in the short term you're right, but change is long due.
- mallets 1y ago
  Their US facilities are purposefully NOT bleeding-edge, and also cost more. And this version of Intel can't, maybe a different one that fully separates design and foundry could. The best solution long-term would be to directly subsidize foundries, with the right incentives to acquire different customers (how TSMC or Samsung operate). They just might get lucky if everyone hits a hard scaling wall. Whatever happens, tariffs and bans are the absolute worst incentives for innovation and growth.
croemer 1y ago
Monopolists or companies with some degree of Monopoly will absorb some of the tariffs as opposed to passing on. Putting tariffs on monopolists makes some economic sense. Tariffs on commodities though don't.
- mallets 1y ago
  Monopolies with strong demand for their products will happily pass on the costs, and then some. The delicate balance between encouraging demand while maintaining margins. On the political side of things, they can use their influence and customer base to pressure the government. Silently eating the costs isn't good for them or the market as a whole, long-term.