TSMC: Chip giant delays Arizona production in blow to Biden

[Daniel Nenni]

Chipmaking giant Taiwan Semiconductor (TSMC) has delayed the start of production at its factory in the US state of Arizona, in a setback to President Biden's technology ambitions.

The firm says chip manufacturing will no longer start next year, due to a shortage of skilled workers. The White House has laid out plans to bring more chip production to the US.

It comes as an ongoing trade row centered on the technology intensifies between Washington and Beijing. TSMC's shares closed more than 3% lower in Taiwan on Friday. On Thursday, TSMC Chairman Mark Liu said production of advanced microprocessors at its Arizona factory in the south west of the US would now begin in 2025.

During an earnings presentation, Mr Liu said the plant, which has been under construction since April 2021, faced a shortage of workers with the "specialised expertise required for equipment installation in a semiconductor-grade facility." He added that the firm was "working to improve the situation, including sending experienced technicians from Taiwan to train the local skilled workers [in the US] for a short period of time".

TSMC also forecast a 10% drop in sales this year, because of slower demand for semiconductors. The company said its profits fell by around 23% to 181.8bn Taiwanese dollars ($5.8bn; £4.5bn) in the three months to the end of June, compared to the same time last year.

TSMC first announced plans to build a facility in Arizona in 2020, during the presidency of Donald Trump. In December last year, the firm said it would more than triple its investment in the project to $40bn (£31.1bn). This marked one of the largest foreign investments in American history.

At that time, Mr Liu said the first of TSMC's two semiconductor production facilities at the Arizona plant would be operational by 2024, with the second coming online by 2026. A long-running technology dispute has seen the US impose a series of measures against China's chipmaking industry, while investing billions of dollars to boost America's semiconductor industry. The US produces around 10% of the global supply of computer chips, which are key to everything from cars to mobile phones. In 1990 the country accounted for almost 40% of global production.

Last year, President Biden signed legislation committing $280bn to high tech manufacturing and scientific research in the US. The investment included tax breaks for companies that built computer chip manufacturing plants in the country.

TSMC: Chip giant delays Arizona production in blow to Biden

Taiwan-based TSMC says semiconductors manufacturing at its Arizona plant will no longer begin in 2024.

www.bbc.com

 

[Barnsley]

When using tax payers money this is the balancing act is it not?
Foreign folk compared to local folk.
Would TSMC just cannibalise other companies or are their really not enough US Citizens capable of doing what TSMC want?

 

[Daniel Nenni]

Personally I think the drop in demand had something to do with the AZ delay as well. Maybe even more so but that is not something TSMC would say publicly. If the other TSMC fabs are running at 70% what is the hurry building more capacity? Based on the latest investor call packaging (CoWaS) is the bottleneck, for NVIDIA and AMD at least. TSMC is doubling down on packaging but it will take time.

 

[cliff]

So this is the bottom line...

1) The US and Japan is protecting Taiwan
2) The US DoD wants the TSMC 5nm process in the US
3) TSMC/Taiwan invests in Japan (28-12nm)
4) TSMC/Taiwan pulls out of the US commitment.

Pick one:
A) Americans are either too lazy or
B) TSMC had no intention of meeting their commitment. Making an empty building is cheap
C) Both

 

[blueone]

So this is the bottom line...

1) The US and Japan is protecting Taiwan
2) The US DoD wants the TSMC 5nm process in the US
3) TSMC/Taiwan invests in Japan (28-12nm)
4) TSMC/Taiwan pulls out of the US commitment.

Pick one:
A) Americans are either too lazy and
B) TSMC had no intention of meeting their commitment. Making an empty building is cheap
C) Both

You're such a character, Cliff! More likely the delay is due to a drop in demand (as Dan postulates), and the shortage of qualified applicants is due to TSMC trying to hire away from Intel (the home team and has a better reputation as an employer) and that TSMC gets a lot of bad press as a sweat shop, as read by people under ~40 years old. Sometimes I read Reddit to get a sense of what younger US people think (and I often regret it).

https://www.reddit.com/r/technology/comments/1458u4y

 

[Daniel Nenni]

Maybe Americans would rather work from home?

 

[blueone]

Maybe Americans would rather work from home?

Not me. I didn't do it often or for very long, but when I did I disliked it. I was a workaholic for 40-something years, and that's the only way I knew how to work, and I
liked needed it. But I'm old and obsolete. I do wish I had cloud computing when I was in my 20s though. It would have made me more productive at 3:00am when I woke up with a solution to an engineering problem.

 

[MKWVentures]

So this is the bottom line...

1) The US and Japan is protecting Taiwan
2) The US DoD wants the TSMC 5nm process in the US
3) TSMC/Taiwan invests in Japan (28-12nm)
4) TSMC/Taiwan pulls out of the US commitment.

Pick one:
A) Americans are either too lazy and
B) TSMC had no intention of meeting their commitment. Making an empty building is cheap
C) Both

Getting Skilled labor anywhere .... especially in the US can be difficult. The TSMC site is not an empty building. I visited both Intel and TSMC Arizona sites a few weeks ago .... they are moving along nicely.

Most likely reason for delay: There is not demand requiring a new Fab in the US ..... Commitments and announcements are for politicians. Wafer starts are for customers. this just in.... Semis are in a recession this year with growth in 2024 and 2025.

DOD will not be buying parts from TSMC.

Just an opinion

 

[MKWVentures]

Maybe Americans would rather work from home?

As an American, I have the right to install AMAT tools while sitting in my home petting my dog. Its TSMCs job to figure out how to make that work LOL

 

[Daniel Nenni]

Not me. I didn't do it often or for very long, but when I did I disliked it. I was a workaholic for 40-something years, and that's the only way I knew how to work, and I
liked needed it. But I'm old and obsolete. I do wish I had cloud computing when I was in my 20s though. It would have made me more productive at 3:00am when I woke up with a solution to an engineering problem.

I prefer working from home and Zoom calls versus traveling to Taiwan and China for meetings. I do work more total hours but not having to drive in Silicon Valley traffic is well worth it. Not to mention the cost savings.

A friend of mine told me his company issued a back to the office order in January and they have now lost 30% of their workforce. Talk about a productivity loss.

 

[blueone]

I prefer working from home and Zoom calls versus traveling to Taiwan and China for meetings.

That is rational and perfectly understandable.

I do work more total hours but not having to drive in Silicon Valley traffic is well worth it. Not to mention the cost savings.

I know. I lived and worked there for four years.

A friend of mine told me his company issued a back to the office order in January and they have now lost 30% of their workforce. Talk about a productivity loss.

Wow.

 

[hist78]

So this is the bottom line...

1) The US and Japan is protecting Taiwan
2) The US DoD wants the TSMC 5nm process in the US
3) TSMC/Taiwan invests in Japan (28-12nm)
4) TSMC/Taiwan pulls out of the US commitment.

Pick one:
A) Americans are either too lazy and
B) TSMC had no intention of meeting their commitment. Making an empty building is cheap
C) Both

"4) TSMC/Taiwan pulls out of the US commitment."

How do you come to this conclusion or predict this outcome?

 

[cliff]

"4) TSMC/Taiwan pulls out of the US commitment."

How do you come to this conclusion or predict this outcome?

Excuses... Good excuses, but excuses. They already knew that we are lazy and privileged. Morris told us that. Although he was not accurate. He forgot woke.

DOD will not be buying parts from TSMC.

Perhaps not, but wasn't the plan for the DoD to use the TSMC-AZ 5nm facility?

Note to stay-at-boat Dan:
I have only had 1 successful remote worker in my company history... from Vladivostok, Russia.

Of course TSMC gets a bad Glassdoor rating. They expect their workers to uh... work. They are such meanies.

 

[Barnsley]

I prefer working from home and Zoom calls versus traveling to Taiwan and China for meetings. I do work more total hours but not having to drive in Silicon Valley traffic is well worth it. Not to mention the cost savings.

A friend of mine told me his company issued a back to the office order in January and they have now lost 30% of their workforce. Talk about a productivity loss.

My place tried the all back to office last year when all restrictions lifted , even though I am in office full time, I argued that a mixed system of 3 days in office with flexibility for other 2 days would be a better way as it served no purpose to piss off the people. We have a tough time recruiting/retaining at the best of times so keeping something that could be considered " a perk" especially those with young families for me is a win.

 

[Barnsley]

Excuses... Good excuses, but excuses. They already knew that we are lazy and privileged. Morris told us that. Although he was not accurate. He forgot woke.

Perhaps not, but wasn't the plan for the DoD to use the TSMC-AZ 5nm facility?

Note to stay-at-boat Dan:
I have only had 1 successful remote worker in my company history... from Vladivostok, Russia.

Of course TSMC gets a bad Glassdoor rating. They expect their workers to uh... work. They are such meanies.

Some of the Tik Toks from those working at FAANG really were an eye opener for some at the coal face in manufacturing.