TSMC cannot make 2nm chips abroad now: MOEA

[Daniel Nenni]

Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday.

Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday.

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

Minister of Economic Affairs J.W. Kuo speaks at a meeting of the legislature’s Economics Committee in Taipei yesterday.
Photo: Tu Chien-jung, Taipei Times

“Although TSMC plans to make 2-nanometer chips [abroad] in the future, its core technology will stay in Taiwan,” Kuo added.

LAW
Taiwanese law limits domestic chipmakers to producing chips abroad that are at least one generation less advanced than their fabs at home. TSMC told investors in July its next-generation A-16 chip is to enter volume production in the second half of 2026, after ramping up production of 2-nanometer chips next year.

According to TSMC’s overseas manufacturing roadmap, the company plans to produce 2-nanometer or more advanced chips in the US by the end of this decade, when its second fab in Arizona — which would utilize its 3-nanometer and 2-nanometer process technologies — becomes operational in 2028.

The third fab in Arizona would produce chips using 2-nanometer or even more advanced process technology, the chipmaker said.

TSMC’s first Arizona fab is set to ramp up production of 4-nanometer chips next month.

BILATERAL TIES
Meanwhile, Taiwan Semiconductor Industry Association (TSIA) chairman Cliff Hou (侯永清) yesterday said that history has shown that the result of the US presidential election would not significantly affect the company’s decades-long partnership between Taiwan and the US.

Hou also serves as a senior vice president at TSMC.

“The bilateral relationship has not changed because of the political landscape changes in the US,” Hou said at a forum in Hsinchu.

“There could be some alterations in details regarding this partnership. We will look at it when everything is certain,” Hou added.

Asked about how the TSIA could help local semiconductor companies navigate the challenges of the potential 10 percent tariff hikes that Trump threatened during his election campaign, Hou said the association has not received any official notification yet.

However, Taiwan should pour more resources into advancing chip technology and expanding its supply chain expertise to maintain global leadership, he said.

“We should accelerate research and development to ensure our standing as an indispensable member of the global semiconductor supply chain,” Hou said. “We are also working with the government to see whether we can attract foreign partners to set up design and materials centers in Taiwan.”

The 27-year TSMC veteran added that Taiwan must also aim to develop more expertise in equipment and materials, areas that are dominated by foreign businesses.

TSMC cannot make 2nm chips abroad now: MOEA - Taipei Times

Bringing Taiwan to the World and the World to Taiwan

www.taipeitimes.com

 

[blueone]

Really dumb.

 

[siliconbruh999]

Intel Just got another reason to say give us the fund

 

[DepthFirst]

I wasn’t aware that TSMC’s decision to keep its AZ facilities trailing edge was legally enforced. I suspect the incoming administration isn’t going to take kindly to that.

 

[Daniel Nenni]

I wasn’t aware that TSMC’s decision to keep its AZ facilities trailing edge was legally enforced. I suspect the incoming administration isn’t going to take kindly to that.

It didn't seem to bother the CHIPs Act. Given that TSMC releases new nodes every two years I don't see an issue but I am wondering if subsidies from the Taiwan Government are tied to it?

"However, Taiwan should pour more resources into advancing chip technology and expanding its supply chain expertise to maintain global leadership, he said."

More money for the semiconductor ecosystem, absolutely!

 

[tooLongInEDA]

Really dumb.

Really ?

Here's the full quote:

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

The key word is surely currently.

I read this as saying this is simply a matter of when and that date may be up for negotiation.

 

[blueone]

Really ?

Here's the full quote:

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

The key word is surely currently.

I read this as saying this is simply a matter of when and that date may be up for negotiation.

The US just elected a president who probably knows nothing substantial about the semiconductor field, has openly accused Taiwan of stealing the US chip manufacturing base, and has been touting an "America First" policy for years, and thinks we should charge Taiwan for their defense. And he's not one who seems to comprehend subtleties. It doesn't matter what the details or realities are, I think this was a really dumb time to be making statements like this.

 

[XYang2023]

The US just elected a president who probably knows nothing substantial about the semiconductor field, has openly accused Taiwan of stealing the US chip manufacturing base, and has been touting an "America First" policy for years, and thinks we should charge Taiwan for their defense. And he's not one who seems to comprehend subtleties. It doesn't matter what the details or realities are, I think this was a really dumb time to be making statements like this.

Intel's progress in 18A process could have political implications in this context.

Intel CEO optimistic about CHIPS Act’s future after trading texts with JD Vance

Intel CEO Pat Gelsinger worked closely with the Biden administration to pass the 2022 CHIPS Act. Now, he's hoping to build a similar partnership with the second Trump administration.AP Intel CEO Pat Gelsinger told employees Friday that he has texted with Vice President-elect JD Vance since the...

semiwiki.com

 

[XYang2023]

Additionally, certain political comments from Taiwan are not helping the situation.

Causing trouble for Taiwan! PTS TaiwanPlus calls Trump a "serious criminal"; Wang Hongwei warns of serious consequences.

The U.S. presidential election has just concluded, with former Republican President Trump defeating current Democratic Vice President Kamala Harris and returning to the White House. Media outlets worldwide are closely covering election reports. However, KMT legislator Wang Hongwei revealed that in a TaiwanPlus video about the U.S. election, an outsourced reporter described Trump’s election as “electing a convicted felon,” which Wang argues not only embarrasses Taiwan but could also damage Taiwan-U.S. relations. “Do we really need a public television station filled with ideological bias and lacking professional journalism?” she questioned.

Wang posted on Facebook yesterday, stating that while Trump’s victory in the U.S. election was smoothly achieved, a TaiwanPlus video on the election was heavily criticized by media professionals for being politically biased and unprofessional. She claimed that the video was quietly taken down after the backlash.

Wang pointed out that in the video, TaiwanPlus’s outsourced reporter said, “This election will be a historic moment. Will Americans choose a female president or a convicted felon? It appears they’ve chosen the felon…” Such statements, Wang said, left journalists wondering if this was actually a report from Taiwan’s public television.

She criticized Taiwan’s Public Television Service (PTS), which receives taxpayer funding, for not fostering a healthy media environment for Taiwanese people and, instead, causing trouble for Taiwan. The video, which was broadcast globally, is a serious blunder, she said. PTS tried to quietly take it down as if nothing happened, and no one has stepped up to take responsibility. “Is this the kind of rhetoric our government supports?” Wang questioned.

Wang also mentioned a previous instance involving Keelung Mayor Hsieh Kuo-liang’s recall, where she claimed PTS’s Taiwanese language channel disregarded neutrality by reporting solely from the perspective of the recall organizers, only mentioning Hsieh and the city government’s response for seven seconds. She argued that this lawless behavior shows the downfall of the PTS group, which has turned into a political tool despite being funded by taxpayers.

“From the Hsieh recall to the Trump insult, do we really need a public television station full of ideological bias and lacking journalistic professionalism?” Wang criticized. She urged the ruling party to exercise restraint, accusing PTS of partisan reporting and warning that they “won’t compromise on this matter.” She implored PTS not to bring domestic bad practices to the international stage, emphasizing that such actions not only damage Taiwan’s image but could also harm Taiwan-U.S. relations.

https://www.chinatimes.com/realtimenews/20241109000882-260407?chdtv

Taiwan’s Foreign Minister: "Making America Great Again" is not possible without Taiwan.

There are concerns that if the U.S. Republican Trump takes office, he may return to isolationism. However, Taiwan's Foreign Minister, Lin Chia-lung, stated that “making America great again” is not possible without Taiwan; otherwise, America will struggle to achieve greatness again.

According to Taiwan's United Daily News and TVBS News, Lin reported on Thursday (November 7) during a session at the Legislative Yuan’s Foreign Affairs and National Defense Committee that election competition and party transitions are the norm in democratic countries. Even with a change in presidency, the stability of Taiwan-U.S. relations remains significant.

He pointed out that currently, the U.S. Senate’s Taiwan Caucus has over 30 members. Of the nine members who ran for re-election, six have successfully retained their seats, and all four co-chairs of the House Taiwan Caucus were re-elected, further solidifying Taiwan's support in the U.S. Congress.

When asked by DPP legislator Chen Kuan-ting about whether Taiwan’s chip industry would be impacted by Trump’s election, Lin said that Taiwan-U.S. relations are based not only on shared ideals but also on a deeply integrated economic relationship, demonstrating a mutually beneficial partnership.

Regarding the semiconductor and chip industry, Lin emphasized that Taiwan’s chip industry holds an irreplaceable advantage globally. Taiwan-U.S. relations are complementary, with aligned interests, and their cooperative relationship is deeply integrated. Therefore, the U.S. would not adopt policies that would harm its own interests.

台外长：“让美国再次伟大”不能没有台湾

外界担忧美国共和党的特朗普入主白宫后将重拾孤立主义，但台湾外长林佳龙称，“让美国再次伟大”离不开台湾，否则美国难以实现再次伟大。综合台湾《联合报》和TVBS新闻网报道，林佳龙星期四...

www.zaobao.com.sg

 

[hist78]

Really ?

Here's the full quote:

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

The key word is surely currently.

I read this as saying this is simply a matter of when and that date may be up for negotiation.

Knowing US and Taiwan's politics, everything is negotiable when it comes to such issues. In principle, both governments are interested to promote bilateral relationships that benefit both countries. Semiconductor industry is definitely one of them.

Additionally TSMC N2/2nm won't go into high volume production until late 2025 or early 2026. This kind of worries is premature.

 

[hist78]

Intel Just got another reason to say give us the fund

Not necessary. For US government, real product, real customers, and real production volumes are critical for receiving the CHIPS Act's "manufacturing" incentives. I think this is why Globalfoundries and TSMC already completed the binding agreements with Commerce Department while Intel hasn't. No binding agreement means no subsides or no full amount of subsides to begin with. Intel and Pat Gelsinger tried to avoid telling people that Intel can't commit to a time line and those associated deliverables.

Instead Gelsinger chose to ignore CHIPS Act legislation intentions and mandate. This problem won't go away easily even when Trump administration is in place.

 

[XYang2023]

Not necessary. For US government, real product, real customers, and real production volumes are critical for receiving the CHIPS Act's "manufacturing" incentives. I think this is why Globalfoundries and TSMC already completed the binding agreements with Commerce Department while Intel hasn't. No binding agreement means no subsides or no full amount of subsides to begin with. Intel and Pat Gelsinger tried to avoid telling people is that Intel can't commit to a time line and those associated deliverables.

Instead Gelsinger chose to ignore CHIPS Act legislation intentions and mandate. This problem won't go away easily even when Trump administration is in place.

I believe the fundamental issue is that Taiwan lacks confidence in U.S. capabilities in semiconductor manufacturing and manufacturing overall. As a result, they are hesitant to commit to it. In a recent interview, the Director of the Economic Forecasting Center at the Taiwan Institute of Economic Research reaffirmed this point:

He suggested that, to appease Trump, Taiwanese companies could invest in the Rust Belt but should avoid bringing semiconductor manufacturing to the U.S. This approach is speculative and short-sighted, likely to result in outcomes similar to Foxconn’s project in Wisconsin.

Without Intel's significant investments in advancing process technology and fabs, Taiwan’s foreign minister’s recent comment might hold true (in an alternative reality) - Taiwan’s Foreign Minister: "Making America Great Again" is not possible without Taiwan.

Moreover, Intel’s commitment to Ohio (a Rust Belt state) demonstrates not only a focus on bringing advanced processes to the U.S. but also a deep, long-term commitment to the U.S. economy. This stands in stark contrast to the approach of many Taiwanese companies.

 

[blueone]

Taiwan’s Foreign Minister: "Making America Great Again" is not possible without Taiwan.

I don't know what Make American Great Again really means (and I'm not sure I want to know), but there's no doubt in my mind that Taiwan wouldn't exist as an independent whatever-it-is without the US military capabilities.

Moreover, Intel’s commitment to Ohio (a Rust Belt state) demonstrates not only a focus on bringing advanced processes to the U.S. but also a deep, long-term commitment to the U.S. economy. This stands in stark contrast to the approach of many Taiwanese companies.

Now that you mention it, Gelsinger's strategy does seem to be Make Intel Great Again. (MIGA?)

 

[hist78]

F.T. "Taiwan considers big US defence purchases as overture to Donald Trump"

Reuters "For Taiwan, Trump's 'protection' money may mean new and early big ticket arms deal"

US$ 15 Billion --- 60 * F35 ; 4 * E2D Advanced Hawkeye ; 10 * US retired battleship ; 600 * Patriot's missile

They all look encouraging but right now the problem both US Congress and executive branch know very well is the order backlog.

Taiwan likes to buy US weapon systems and related parts and support. But US defense industry is too slow to deliver. Up until September 2024 the order backlog has reached $20.5 billion. But by some other accounts, the number is even as big as $24.24 billion.

To deal with such a serious situation, the 117th Congress passed the bipartisan Arms Exports Delivery Act (H.R. 8259), which became law through the FY23 NDAA, to track transfers and ensure efficient and timely delivery of U.S. defense equipment already sold to Taiwan and other Indo-Pacific allies.

But just like some seriously delayed or troubled semiconductor projects, many military sales to Taiwan that have been approved and paid for are still in prolonged delivery timeline, if you trust what those defense industry contractors have promised.

 

[samwilde]

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

The key word is surely currently.
I read this as saying this is simply a matter of when and that date may be up for negotiation.

No. What he means is that the US will get the 2nm technology after Taiwan has the node after that. Foreign fabs will always be behind.

I already said as much here. TSMC is to retain its most advanced node in Taiwan. And this is expected to be in perpetuity.

 

[XYang2023]

They all look encouraging but right now the problem both US Congress and executive branch know very well is the order backlog.

Taiwan likes to buy US weapon systems and related parts and support. But US defense industry is too slow to deliver. Up until September 2024 the order backlog has reached $20.5 billion. But by some other accounts, the number is even as big as $24.24 billion.

To deal with such a serious situation, the 117th Congress passed the bipartisan Arms Exports Delivery Act (H.R. 8259), which became law through the FY23 NDAA, to track transfers and ensure efficient and timely delivery of U.S. defense equipment already sold to Taiwan and other Indo-Pacific allies.

But just like some seriously delayed or troubled semiconductor projects, many military sales to Taiwan that have been approved and paid for are still in prolonged delivery timeline, if you trust what those defense industry contractors have promised.

It is unrealistic. For example, for the F-35, the factory lead time is 10 years, and pilot training takes another 8 years, totaling 18 years (as reported by Taiwanese media).

Meanwhile, at the China International Aviation & Aerospace Exhibition:

https://www.reuters.com/world/asia-pacific/new-chinese-stealth-fighter-take-centre-stage-chinas-biggest-air-show-2024-11-08/

 

[blueone]

It is unrealistic. For example, for the F-35, the factory lead time is 10 years, and pilot training takes another 8 years, totaling 18 years (as reported by Taiwanese media).

Meanwhile, at the China International Aviation & Aerospace Exhibition:

https://www.reuters.com/world/asia-pacific/new-chinese-stealth-fighter-take-centre-stage-chinas-biggest-air-show-2024-11-08/

F35 lead time is irrelevant for Taiwan anyway. Taiwan is not approved by the US government to buy F35s, new or used.

 

[XYang2023]

F35 lead time is irrelevant for Taiwan anyway. Taiwan is not approved by the US government to buy F35s, new or used.

That's what I think. I found those reports from Taiwan about the F-35 quite odd. They also do not believe the U.S. would sell them the F-35.

 

[Mooredaddy]

That's what I think. I found those reports from Taiwan about the F-35 quite odd. They also do not believe the U.S. would sell them the F-35.

Biggest reason is the ROC military is rife with CCP sympathizers. It would be a disaster and an major coup for China to get a hold of so many sensitive documents

 

[Paul2]

Really ?

Here's the full quote:

“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s Economics Committee in Taipei.

The key word is surely currently.

I read this as saying this is simply a matter of when and that date may be up for negotiation.

The wording of the regulation was never taken literally, for example TSMC's mainland fabs were not that behind the leading edge at the time per ITRS roadmap, but they were so in commercial terms. TSMC's 16nm was not really half the size of 22nm, but since there were many half-nodes in between, it seems the regulation was bent.