U.S. Confirms $6.6 Billion Subsidy for TSMC Ahead of Trump's Second Term $TSM

The Biden administration has confirmed a subsidy of $6.6 billion (approximately 9.2 trillion won) for Taiwan's TSMC, the world's largest foundry (semiconductor contract manufacturing) company.…

— ChaCha 𝕏 (@chacha72kobe4er) November 16, 2024

The strategic significance of Taiwan Semiconductor Manufacturing Co.'s $TSM $65 billion investment in U.S. factories underscores the critical role of semiconductors in the global supply chain.

Governor Yang Chin-long's optimism for TSMC's expansion in Arizona aligns with…

— Fazir Ali (@KingFazir) November 14, 2024

A win for Arizona and our national security interests.

this is one of those things that seems really good on paper, but makes you wonder what the details and caveats are.

TSMC is under no obligation to move a notable chunk of production here once built or sell wafer production at global competitive prices.

their fabs in asia will ALWAYS have a lower cost and higher profit margin over anything they make in the US, and those higher costs will be passed on to consumers.

This deal is the only one I can think of that I can say 'Good Biden'. It's a tepid 'Good Biden' as I don't know the amount on his kickbacks. I assume the usual 10%.

Having domestic semiconductor manufacturing at a large scale seems quite important for us strategically. Sadly, it never should have gotten moved overseas in the first place.

Biden admin has been doing a death by 1000 cuts to screw this deal up so far so this is something Trump can clear the road and get these sites back on track. We need this manufacturing out of Taiwan as much as possible.

There's a pretty good book about this called Chip War.

I just started it

BadMoonRisin said:

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There's a pretty good book about this called Chip War.

I just started it

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if you just started it, how do you know it is "pretty good"

Fair.

I've had several people recommend it

As I recall, the program requires union labor and that daycare must be provided for the female employees.

That was for the construction process. DEI built into the contracts with X number of women of color required to be hired for construction and other jobs. Added insane costs and god knows how many other problems with the construction. TSMC hates it.

TSMC is trying to bring as many Taiwanese experts over here as possible to run the facilities. American unions hate it and have been trying to build in protections against hiring of foreign workers in the contracts.

In this case, only a few thousand people in the world are qualified to build, run, and maintain some of this equipment and the vast majority are Taiwanese. Hopefully we don't nerf the capabilities of these plants to appease a labor union. This is a national security issue.

isn't arizona right to work, so unions have no sway unless idiots in govt put it in contracts?

and even then would it not be illegal since "right to work"?

BadMoonRisin said:

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Fair.

I've had several people recommend it

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well then.. my ****posting here is done.

C@LAg said:

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this is one of those things that seems really good on paper, but makes you wonder what the details and caveats are.

TSMC is under no obligation to move a notable chunk of production here once built or sell wafer production at global competitive prices.

their fabs in asia will ALWAYS have a lower cost and higher profit margin over anything they make in the US, and those higher costs will be passed on to consumers.

---

My understanding of the chip wars has been that the us companies missed out on the ASM machines that TSMC gambled on, so they basically swore off that generation and are investing in ASM's next generation machines to leapfrog TSMC. I may be wrong, but when it reshores the outputs will be another order of magnitude better.

Get Off My Lawn said:

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C@LAg said:

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this is one of those things that seems really good on paper, but makes you wonder what the details and caveats are.

TSMC is under no obligation to move a notable chunk of production here once built or sell wafer production at global competitive prices.

their fabs in asia will ALWAYS have a lower cost and higher profit margin over anything they make in the US, and those higher costs will be passed on to consumers.

---

My understanding of the chip wars has been that the us companies missed out on the ASM machines that TSMC gambled on, so they basically swore off that generation and are investing in ASM's next generation machines to leapfrog TSMC. I may be wrong, but when it reshores the outputs will be another order of magnitude better.

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given that THIS particular fab plant is TSMC, not sure how that applies here. TSMC is not going to undercut themselves in the global arena. And THEY will be the ones determining what machines goes inside the plant.

Again, a lot of this is smoke and mirrors to get credit/loans and appease the American govt. The CHIPS act should be targeting domestic construction AND ownership, e.g. companies like Intel, so that they are more competitive on the global stage while retaining the assets and technical know-how here in the US. . But intel is doing nothing but ****ting bed after bed these days. And AMD is not into this.

the ones who COULSD benefit most are nvidia, Apple, AMD Intel. Not many others.

Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

Get Off My Lawn said:

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Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

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my point is money would have been better spent on one of our domestic companies to convince them to build fabs here.

Not a foreign company.

I drive by the TSMC site when I head up to Flagstaff. It's big, and they have plenty of space to expand.

My understanding is that they are starting it up on an older tech node while continuing to run their leading edge process in Taiwan.

Regarding some of the comments above on Taiwanese labor - there was a lawsuit recently filed by some of their US workers alleging preferential treatment of the Taiwanese workers. Everyone I know who went to work there have either left or are looking to leave.

I did not make that clear in my statement. Thanks for clarifying.

Somewhat ironic INTC signed up. They are a shell of what they were in the late 80's/early 90's.

C@LAg said:

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Get Off My Lawn said:

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Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

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my point is money would have been better spent on one of our domestic companies to convince them to build fabs here.

Not a foreign company.

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They don't have the know how, or talent.
TSMC will struggle to build fabs here if they aren't allowed to get international talent.
Building fabs is highly specialized, and TSMC is light years ahead of anyone else.

deddog said:

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C@LAg said:

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Get Off My Lawn said:

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Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

---

my point is money would have been better spent on one of our domestic companies to convince them to build fabs here.

Not a foreign company.

---

They don't have the know how, or talent.
TSMC will struggle to build fabs here if they aren't allowed to get international talent.
Building fabs is highly specialized, and TSMC is light years ahead of anyone else.

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which is why the purpose of the law SHOULD have focused on getting AMERICAN companies to catch up. Make these be joint projects so AMERICANS are learning and using the tech.

Not funding and subsidizing foreign companies with foreign workers.

It is no better than just farting away billions to foreign countries - see Ukraine, Israel, etc.

deddog said:

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C@LAg said:

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Get Off My Lawn said:

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Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

---

my point is money would have been better spent on one of our domestic companies to convince them to build fabs here.

Not a foreign company.

---

They don't have the know how, or talent.
TSMC will struggle to build fabs here if they aren't allowed to get international talent.
Building fabs is highly specialized, and TSMC is light years ahead of anyone else.

---

Yes TSMC is world-class, but imo they are not in a class of their own in the building and tooling of fabs. Others are more than capable, but have abandoned internal fabs or use TSMC because they provide an economy of scale that most captive fabs simply cannot match. So much so that it wasn't uncommon to be able to run something at TSMC cheaper than an internal fab. And the absolute worst investment in the world is a fab that is not always running at capacity.

Where they are *far* better than anyone else in the is in the foundry business -- running products for external customers. I've got products all over the world and no one else is close to providing equivalent level of service.

C@LAg said:

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deddog said:

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C@LAg said:

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Get Off My Lawn said:

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Not to advocate for government theft, but from an historical perspective facilities built in foreign lands are theirs if they want them.

I still don't like the concept of non-Americans owning our land… but if a foreign company is building a strategic manufacturing capability within our borders - thats far more up side than down. Although if it's with tax payer money that certainly takes sweetness out of it.

---

my point is money would have been better spent on one of our domestic companies to convince them to build fabs here.

Not a foreign company.

---

They don't have the know how, or talent.
TSMC will struggle to build fabs here if they aren't allowed to get international talent.
Building fabs is highly specialized, and TSMC is light years ahead of anyone else.

---

which is why the purpose of the law SHOULD have focused on getting AMERICAN companies to catch up. Make these be joint projects so AMERICANS are learning and using the tech.

Not funding and subsidizing foreign companies with foreign workers.

It is no better than just farting away billions to foreign countries - see Ukraine, Israel, etc.

---

The good news is there are quite a few western companies benefitting from this as well.

Intel f'd themselves and our supply chain. I'm usually against this sort of thing, however this is a major national security/economic security item. It'd be like subsidies for hardening our grid and onshoring medicine manufacturing. Those are both necessary and good and while I'm not fond of the subsidies to get that done, those are key items that we HAVE to have and any disruption is a critical problem.

aezmvp said:

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Intel f'd themselves and our supply chain. I'm usually against this sort of thing, however this is a major national security/economic security item. It'd be like subsidies for hardening our grid and onshoring medicine manufacturing. Those are both necessary and good and while I'm not fond of the subsidies to get that done, those are key items that we HAVE to have and any disruption is a critical problem.

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I agree, we need more things like this to happen, not exactly sure who did it but this is a good move IMO

aezmvp said:

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Intel f'd themselves and our supply chain. I'm usually against this sort of thing, however this is a major national security/economic security item. It'd be like subsidies for hardening our grid and onshoring medicine manufacturing. Those are both necessary and good and while I'm not fond of the subsidies to get that done, those are key items that we HAVE to have and any disruption is a critical problem.

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Intel is big, no doubt, but there's a lot more here than just Intel, who currently have on the order of 7-8% of the global semiconductor market share. And I would argue they were one of the least impacted by the chip shortage because they own their own fabs, test and assembly. Very few companies are (still) integrated like Intel, so most every other fabless semi was far more impacted than Intel. Of course Intel still had problems with supply chain, sourcing, etc. but not nearly to the extent of the rest of the market.

BassCowboy33 said:

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hoopla said:

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U.S. Confirms $6.6 Billion Subsidy for TSMC Ahead of Trump's Second Term $TSM

The Biden administration has confirmed a subsidy of $6.6 billion (approximately 9.2 trillion won) for Taiwan's TSMC, the world's largest foundry (semiconductor contract manufacturing) company.…

— ChaCha 𝕏 (@chacha72kobe4er) November 16, 2024

The strategic significance of Taiwan Semiconductor Manufacturing Co.'s $TSM $65 billion investment in U.S. factories underscores the critical role of semiconductors in the global supply chain.

Governor Yang Chin-long's optimism for TSMC's expansion in Arizona aligns with…

— Fazir Ali (@KingFazir) November 14, 2024

A win for Arizona and our national security interests.

---

Future world wars, if fought, will be fought over these resources. The fact TSMC is building that mammoth AZ facility is a huge national defense win.

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A win would be them expanding here and them paying for it. This is just another cash grab.

BadMoonRisin said:

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There's a pretty good book about this called Chip War.

I just started it

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I've read it. Fantastic book.

Get Off My Lawn said:

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C@LAg said:

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this is one of those things that seems really good on paper, but makes you wonder what the details and caveats are.

TSMC is under no obligation to move a notable chunk of production here once built or sell wafer production at global competitive prices.

their fabs in asia will ALWAYS have a lower cost and higher profit margin over anything they make in the US, and those higher costs will be passed on to consumers.

---

My understanding of the chip wars has been that the us companies missed out on the ASM machines that TSMC gambled on, so they basically swore off that generation and are investing in ASM's next generation machines to leapfrog TSMC. I may be wrong, but when it reshores the outputs will be another order of magnitude better.

---

It wasn't so much that the U.S. missed out on it, but that nobody could really afford to spend the 20+ years it took to build the machinery required without any ROI or guarantee that it would work.

ASML (a Dutch company) built the equipment used by TSMC and spent decades developing the technology to do it. Numerous companies and nations invested resources and capital in it. It's part of the Tech Alliance, which pits the USA, Netherlands, England, Japan, and Korea against China and Russia.

IslanderAg04 said:

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BassCowboy33 said:

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hoopla said:

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U.S. Confirms $6.6 Billion Subsidy for TSMC Ahead of Trump's Second Term $TSM

The Biden administration has confirmed a subsidy of $6.6 billion (approximately 9.2 trillion won) for Taiwan's TSMC, the world's largest foundry (semiconductor contract manufacturing) company.…

— ChaCha 𝕏 (@chacha72kobe4er) November 16, 2024

The strategic significance of Taiwan Semiconductor Manufacturing Co.'s $TSM $65 billion investment in U.S. factories underscores the critical role of semiconductors in the global supply chain.

Governor Yang Chin-long's optimism for TSMC's expansion in Arizona aligns with…

— Fazir Ali (@KingFazir) November 14, 2024

A win for Arizona and our national security interests.

---

Future world wars, if fought, will be fought over these resources. The fact TSMC is building that mammoth AZ facility is a huge national defense win.

---

A win would be them expanding here and them paying for it. This is just another cash grab.

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The U.S. needs TSMC more than TSMC needs the U.S. In the words of Will Turner, it's a matter of leverage.

How many years before these are online and helping us?

The new TI plant under construction in Sherman says hello.

https://www.ti.com/about-ti/company/ti-at-a-glance/manufacturing/sherman.html

The chip fabs wont last, its a waste of money. You still have to operate the fabs, and they are expensive to run here.

Also FAB capacity is ramping all over the world, so they will be even less profitable, this over capacity has happened before.

They just closed the Samsung facility outside of Austin because they couldn't produce the needed yields. Something like 90% of chips failed QA/QC.

https://wccftech.com/samsung-withdraws-personnel-from-taylor-texas-plant-due-to-low-2nm-gaa-yield/amp/