Building A Chipmaking Fab In The US Costs Twice As Much, Takes Twice As Long As In Taiwan

[Scotten Jones]

I will get some recent input from experts on this. But my take is that it can take twice as long but a lot of that depends on the company doing it. Supply chain and labor availability in asia is much better. I would be shocked if it actually cost 2x as much ... my spreadsheet is nowhere near that big a difference. Tools are still the largest part of capital expense. All this assumes the same subsidies. In the past, other countries gave huge subsidies and the US gave few. that has changed.

What are your thoughts @nghanayem or @Scotten Jones ?

Reminder: NEVER use the publicly stated costs to build a fab that companies publish. Those are meant to get the response they want from government. the actual spending is accurately tracked by a number of sources if you talk to the correct people.

The 2x is for the fab construction and doesn't include tools. I didn't think it was that big a difference either and I got a bunch of expert inputs when I wrote my operating cost comparison article a few year ago. I think things may have changed post COVID, I am looking into it.

 

[osnium]

After asking some long time Intel folks I know I can offer three reasons that Intel R&D died under Sohail.

First, he did not demand robust processes. He was quite happy to accept a process that was held together with human glue provided by constant attention of process engineers. All that mattered is that it worked, the cost in human capital was irrelevant. This resulted in tight process windows and little time to spend on process improvement.

Second, he became a bottleneck in the development process. The story I was told is that there were so many process changes going on at once that there was very little baseline material in the factory to compare the results of the experiments against. Sohail's solution was to limit the number of changes that were allowed to run in the factory at any one time. He did this by keeping a list and reviewing each suggestion personally. If an idea didn't make the cut it didn't get on the list and didn't get run. I don't care who you are no one can be an expert in all areas of the fab. It is just too complex.

Third and I think the most important. He created an environment of fear in which people were afraid to share bad news. Everything got sugarcoated and issues were hidden. That is the kiss of death in any development process.

I was also told that Bill Holt reigned in many of Sohail's worst impulses. When Bill left Sohail was left to his own devices.

Thank you for the detailed insights. Basically, it was an unfortunate confluence of a bad process definition for 10 nm combined with Sohail’s slave driver mentality that killed the golden goose.

 

[siliconbruh999]

After asking some long time Intel folks I know I can offer three reasons that Intel R&D died under Sohail.

First, he did not demand robust processes. He was quite happy to accept a process that was held together with human glue provided by constant attention of process engineers. All that mattered is that it worked, the cost in human capital was irrelevant. This resulted in tight process windows and little time to spend on process improvement.

Second, he became a bottleneck in the development process. The story I was told is that there were so many process changes going on at once that there was very little baseline material in the factory to compare the results of the experiments against. Sohail's solution was to limit the number of changes that were allowed to run in the factory at any one time. He did this by keeping a list and reviewing each suggestion personally. If an idea didn't make the cut it didn't get on the list and didn't get run. I don't care who you are no one can be an expert in all areas of the fab. It is just too complex.

Third and I think the most important. He created an environment of fear in which people were afraid to share bad news. Everything got sugarcoated and issues were hidden. That is the kiss of death in any development process.

I was also told that Bill Holt reigned in many of Sohail's worst impulses. When Bill left Sohail was left to his own devices.

Is the issue fixed rn ?

 

[nghanayem]

After asking some long time Intel folks I know I can offer three reasons that Intel R&D died under Sohail.

First, he did not demand robust processes. He was quite happy to accept a process that was held together with human glue provided by constant attention of process engineers. All that mattered is that it worked, the cost in human capital was irrelevant. This resulted in tight process windows and little time to spend on process improvement.

Second, he became a bottleneck in the development process. The story I was told is that there were so many process changes going on at once that there was very little baseline material in the factory to compare the results of the experiments against. Sohail's solution was to limit the number of changes that were allowed to run in the factory at any one time. He did this by keeping a list and reviewing each suggestion personally. If an idea didn't make the cut it didn't get on the list and didn't get run. I don't care who you are no one can be an expert in all areas of the fab. It is just too complex.

Third and I think the most important. He created an environment of fear in which people were afraid to share bad news. Everything got sugarcoated and issues were hidden. That is the kiss of death in any development process.

I was also told that Bill Holt reigned in many of Sohail's worst impulses. When Bill left Sohail was left to his own devices.

+1 for how things were in the past. I think the most foolish part was doing crazy overtime just to make that human glue, and then taking pride in this clearly unsustainable way to do things. I think there are other angles at play, mostly related to penny-pinching choices that set LTD up for long term failure all for short term cost savings. But from talking to 10+ year experienced intel engineers and technicians, I think this is an accurate assessment of the cultural challenges that contributed to the beginning of Intel's fall from grace that would have been sowed during the early 2010s.

 

[blueone]

Third and I think the most important. He created an environment of fear in which people were afraid to share bad news. Everything got sugarcoated and issues were hidden. That is the kiss of death in any development process.

In my decades in the high-tech industry, I worked with or for several senior managers who operated like this. A couple of them were brand-name "leaders" (ha!) many people would recognize. The pathetic part is that these same jackasses managed upward as shameless loyalists who would say and do pretty much anything to stay in the leadership inner circle. It often worked for a while. Every time I used to meet a character like this, I always wondered how they lived with themselves. The personality type is so wide-spread it must be a relatively common mental illness. The only consoling factor for me was that every one I encountered eventually crashed and burned in a vivid fashion.

 

[Paul2]

In my decades in the high-tech industry, I worked with or for several senior managers who operated like this. A couple of them were brand-name "leaders" (ha!) many people would recognize. The pathetic part is that these same jackasses managed upward as shameless loyalists who would say and do pretty much anything to stay in the leadership inner circle. It often worked for a while. Every time I used to meet a character like this, I always wondered how they lived with themselves. The personality type is so wide-spread it must be a relatively common mental illness. The only consoling factor for me was that every one I encountered eventually crashed and burned in a vivid fashion.

I an engineering company started to underperform, the management has started to lie