Intel struggles to escape mudhole

[prime007]

Seems like Intel Foundry is hitting a few bumps on the road. Qualcomm and Tesla have backed away at least temporary:

“We didn’t get into this mud hole because everything was going great,” said Gelsinger, who took over as CEO in 2021. “We had some serious issues in terms of leadership, people, methodology, et cetera that we needed to attack.”

Pat Gelsinger is keenly aware he must act fast to stop Intel from becoming yet another storied American technology company left in the dust by nimbler competitors.

Over the past decade, graphics-chip maker Nvidia leapfrogged Intel to become America’s most valuable semiconductor company, rivals overtook Intel in making the most advanced chips, and perennial also-ran Advanced Micro Devices has been stealing market share. Intel, by contrast, has faced repeated delays introducing new chips and frustration from would-be customers.

As he sees it, Intel’s problems stem largely from how it botched a transition in how chips are made. Intel came to prominence by both designing circuits and making them in its own factories. Now, chip companies tend to specialize either in circuit design or manufacturing, and Intel hasn’t been able to pick up much business making chips designed by other people.

Once Mighty Intel Struggles to Escape ‘Mud Hole’

Rivals such as Nvidia have left the chip company far behind. CEO Pat Gelsinger aims to reverse firm’s fortunes by vastly expanding its factories.

www.wsj.com

 

[prime007]

Well...then I'm going to contradict myself and post this article as well regarding Nvidia potentially using Intel Foundry:

"You know that we also manufacture with Samsung, and we're open to manufacturing with Intel. Pat [Gelsinger] has said in the past that we're evaluating the process, and we recently received the test chip results of their next-generation process, and the results look good," Huang said.

Nvidia CEO Says Intel's Test Chip Results For Next-Gen Process Are Good

Intel-built Nvidia GPUs could be on the horizon.

www.tomshardware.com

 

[Daniel Nenni]

As I mentioned after the TSMC Symposium, QCOM seems to be back in the TSMC fold in a big way which is bad news for Samsung. Tesla does not have the volume and they are reliant on outside IP so TSMC makes sense. Nvidia is an interesting one. They would be a great partner for IFS with big volumes.

That would be a huge win for IFS and a big loss for Samsung, absolutely. Nvidia is on TSMC N3 so I don't think they are talking about Intel 3. Most likely Intel 18A. If it is Intel 3 it would be in parallel with TSMC N3 based products so the volume may be limited, more like an IFS test run.

Interesting post, thanks.

 

[lilo777]

Intel is definitely struggling but here is a conundrum: can US afford not to have an advanced American semiconductor manufacturing company? And if it is not going to be Intel, then who? Are the US going to go the way of Europe?

 

[count]

I can see NVidia looking at Intel as a second source to TSM, but not their primary supplier.

Intel is definitely struggling but here is a conundrum: can US afford not to have an advanced American semiconductor manufacturing company? And if it is not going to be Intel, then who? Are the US going to go the way of Europe?

US companies don't value manufacturing. The best US talent generally does not want to work in manufacturing. Are you surprised that the US struggles to maintain manufacturing leadership?

 

[lilo777]

I can see NVidia looking at Intel as a second source to TSM, but not their primary supplier.



US companies don't value manufacturing. The best US talent generally does not want to work in manufacturing. Are you surprised that the US struggles to maintain manufacturing leadership?

I get this hence the dilemma for the US. Are they going to give up? Also, not all US manufacturing is bad. US companies manufacturing weapon systems have no problem competing with other countries. Obviously, it comes at a huge cost to US. If the US do decide that semiconductors are as strategically important as the weapons, they, seemingly, have two choices: pay for it (subsidies) or use their hegemonic power. For example, they can ban Japanese, Korean and European countries/companies from buying semiconductors from Taiwan. It sounds weird but this is exactly what the US are doing to Chinese and Russian companies.

 

[blueone]

US companies don't value manufacturing. The best US talent generally does not want to work in manufacturing. Are you surprised that the US struggles to maintain manufacturing leadership?

The data shows otherwise.

Manufacturing Industry Statistics

Applied Economics in US Manufacturing

www.nist.gov

The US is a high cost country to manufacture in, so manufacturing that requires less technical skill or more manual labor mostly goes to lower-cost countries, and China is very difficult for any country to compete with for many of these products. This is a challenge for every country with a high GDP/capita. That's why Germany, Switzerland, France, and Italy focus on luxury goods or industrial equipment. Even China is getting too high cost for low-value consumer electronics manufacturing, though China also has a world-class infrastructure that, say, India and Viet Nam have not yet fully developed. If a company doesn't take advantage of the lowest cost labor with can meet the necessary quality standards they will not be able to compete long-term on price.

 

[hist78]

I get this hence the dilemma for the US. Are they going to give up? Also, not all US manufacturing is bad. US companies manufacturing weapon systems have no problem competing with other countries. Obviously, it comes at a huge cost to US. If the US do decide that semiconductors are as strategically important as the weapons, they, seemingly, have two choices: pay for it (subsidies) or use their hegemonic power. For example, they can ban Japanese, Korean and European countries/companies from buying semiconductors from Taiwan. It sounds weird but this is exactly what the US are doing to Chinese and Russian companies.

US law makers, strategists and policy makers are much more practical, promagmic, and long term than many people think.

1. Intel is struggling and facing all kinds of challenges. Many those difficulties are not solvable by the government's intervention . US government and law makers know they need to help Intel but they clearly know Intel is not and should not be their only hope. The strategy is that with or without Intel, US semiconductor industry and supply chains need to move forward. Currently US are hedging its risks on all aspects of the semiconductor industry and assuming, without Intel, US semiconductor industry will be strong and robust. TSMC, Samsung, SK Hynix, NXP, Infineon, ASML, and many those key non-US semiconductor players are all important to this strategy.

2. Japan, Taiwan, South Korea are all important allies of US on many critical areas for many years . There is no idiot inside or outside US government will propose a ban on buying Taiwan's semiconductor products in order to kill Taiwan's economy. A troubled Taiwan will bring serious troubles to Japan, South Korea, US, Australia, and beyond. By the way, this kind of policy that intentionally to damage Taiwan's economy is serving PRC/CCP's interest very well.

 

[lilo777]

US law makers, strategists and policy makers are much more practical, promagmic, and long term than many people think.

1. Intel is struggling and facing all kinds of challenges. Many those difficulties are not solvable by the government's intervention . US government and law makers know they need to help Intel but they clearly know Intel is not and should not be their only hope. The strategy is that with or without Intel, US semiconductor industry and supply chains need to move forward. Currently US are hedging its risks on all aspects of the semiconductor industry and assuming, without Intel, US semiconductor industry will be strong and robust. TSMC, Samsung, SK Hynix, NXP, Infineon, ASML, and many those key non-US semiconductor players are all important to this strategy.

2. Japan, Taiwan, South Korea are all important allies of US on many critical areas for many years . There is no idiot inside or outside US government will propose a ban on buying Taiwan's semiconductor products in order to kill Taiwan's economy. A troubled Taiwan will bring serious troubles to Japan, South Korea, US, Australia, and beyond. By the way, this kind of policy that intentionally to damage Taiwan's economy is serving PRC/CCP's interest very well.

Well, that's how the rational people would think but the politicians may and do very irrational things. One could say that China was (and still is) the most important part of US supply chain and yet as soon as Huawei jumped ahead of US in wireless tech, US all of a sudden found out that Huawei was spying on the world (the evidence was never presented). With Taiwan, the situation is obviously different. Taiwan will never be in a position to challenge US either economically or militarily. But the issue of US vulnerability in not having its own advanced semiconductor remains and US politicians do look certain to address it.