US Backs TSMC's $65B Arizona Investment with $11.6B Support Package

[AleksandarK]

According to the latest report from Bloomberg, the US government under Joe Biden's administration has announced plans to provide Taiwan Semiconductor Manufacturing Company (TSMC) with a substantial financial support package worth $11.6 billion. The package is composed of $6.6 billion in grants and up to $5 billion in loans. This represents the most significant financial assistance approved under the CHIPS and Science Act, a key initiative to resurrect the US chip industry. The funding will aid TSMC in establishing three cutting-edge semiconductor production facilities in Arizona, with the company's total investment in the state expected to exceed an impressive $65 billion. TSMC's multi-phase Arizona project will commence with the construction of a fab module near its existing Fab 21 facility. Production using 4 nm and 5 nm process nodes is slated to begin by early 2025. The second phase, scheduled for 2028, will focus on even more advanced 2 nm and 3 nm technologies.

TSMC has kept details about the third facility's production timeline and process node under wraps. The company's massive investment in Arizona is expected to profoundly impact the local economy, creating 6,000 high-tech manufacturing jobs and over 20,000 construction positions. Moreover, $50 million has been earmarked for training local workers, which aligns with President Joe Biden's goal of bolstering domestic manufacturing and technological independence. However, TSMC's Arizona projects have encountered obstacles, including labor disputes and uncertainties regarding government support, resulting in delays for the second facility's production timeline. Additionally, reports suggest that at least one TSMC supplier has abandoned plans to set up operations in Arizona due to workforce-related challenges.



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[Daven]

While I do not like ANY government investment into private businesses, at least TSMC factories are used to manufacture OTHER company products. Intel shouldn't be getting ANY federal money to make its OWN products. Since this is not the case, then the federal government must invest in other chip companies without fabs (AMD, Apple, etc). How is it fair that Intel gets billions of dollars to make Core Ultras and Xeons but Apple gets nothing to make M3s and AMD gets nothing to make Ryzens and Epycs?

 

[RimbowFish]

While I do not like ANY government investment into private businesses, at least TSMC factories are used to manufacture OTHER company products. Intel shouldn't be getting ANY federal money to make its OWN products. Since this is not the case, then the federal government must invest in other chip companies without fabs (AMD, Apple, etc). How is it fair that Intel gets billions of dollars to make Core Ultras and Xeons but Apple gets nothing to make M3s and AMD gets nothing to make Ryzens and Epycs?

You're absolutely right, but as tricky as it is, the answer why, is pretty evident

 

[bonehead123]

How is it fair that Intel gets billions of dollars to make Core Ultras and Xeons but Apple gets nothing to make M3s and AMD gets nothing to make Ryzens and Epycs?

It's NOT fair at all, but as the saying goes "money talks & bullshit walks"....

Translation: Intel just has many more well-financed, well-established gov't cronies in their back pockets than those other companies do

 

[Philaphlous]

Here's how I see it, and this is IMHO....
TSMC is primarily based in Taiwan, if China decides...yea, then there would likely be some sort of impact from China on TSMC and trade with the US. If we have a foundry over here in the US, this may reduce that likelihood... at least that's what I think they might be thinking...but I'm sure there's money in it for them somewhere.

 

[KLMR]

I love how USA laugh at socialism. This time with a 6.600.000.000$ grant guffaw and a 5.000.000.000$ loan smile.

 

[Noyand]

While I do not like ANY government investment into private businesses, at least TSMC factories are used to manufacture OTHER company products. Intel shouldn't be getting ANY federal money to make its OWN products. Since this is not the case, then the federal government must invest in other chip companies without fabs (AMD, Apple, etc). How is it fair that Intel gets billions of dollars to make Core Ultras and Xeons but Apple gets nothing to make M3s and AMD gets nothing to make Ryzens and Epycs?

Are we just going to ignore the external clients of intel fabs? And that everyone is welcome to use said fabs?

I'm also dumbfounded that, so many don't seem to think that it would be incredibly stupid of Intel to steal their client design, like many assume that they'll 100% do. Once you do that, it's over, nobody is going to trust you. Do you all really think that a company that's been around for so long, and who has been forced to open up their fabs because they couldn't sustain them with their own product, would do something so stupid? Do you also really think that the clients are to sign a contract that won't protect their IP, or that said are IP are not protected in the first place?

Intel sued AMD when they reverse engineered the 386. They lost because the US wanted to even the playing field.
AMD Wins Court Fight to Use of '386' on Intel Chip Clone - Los Angeles Times (latimes.com)

AMD also received a perpetual license to the microcode of Intel’s 386 and 486 chips. It agreed not to copy any other Intel microcode, including that used in the Pentium chip

In the current state of the market, though, that won't fly. In both ways.

Pressuring the OEMs to not use the competitor CPU is one thing, IP theft is another one that doesn't just give them a bad image with consumers but would make them a persona non grata in the whole industry. That's business suicide.
You try to steal a design, you get sued, you lose the trial, then what? What do you have to show for it?

Even Samsung CEO who was caught doing shady thing, and went to jail never did that, even though they fabbed SoC for QUALCOMM, and GPUs for Nvidia.

 

[phanbuey]

While I do not like ANY government investment into private businesses, at least TSMC factories are used to manufacture OTHER company products. Intel shouldn't be getting ANY federal money to make its OWN products. Since this is not the case, then the federal government must invest in other chip companies without fabs (AMD, Apple, etc). How is it fair that Intel gets billions of dollars to make Core Ultras and Xeons but Apple gets nothing to make M3s and AMD gets nothing to make Ryzens and Epycs?

You answered your own question.

Intel Foundry is a fab that has something at least close to the density that TSMC has. No one else that is US-owned does. The govt also invested in Glofo and a bunch of other foundries. This has nothing to do with consumer chip designs.

It's NOT fair at all, but as the saying goes "money talks & bullshit walks"....

Translation: Intel just has many more well-financed, well-established gov't cronies in their back pockets than those other companies do

Those guys would sell each other down the river in a heartbeat. "We need this funding for national security" is a hard sell when you're investing in foreign-owned assets.

 

[Patriot]

Intel sued AMD when they reverse engineered the 386. They lost because the US wanted to even the playing field.
AMD Wins Court Fight to Use of '386' on Intel Chip Clone - Los Angeles Times (latimes.com)

They lost because AMD was a manufacturing partner of Intel and suggested performance enhancements to Intel's chips. Intel said no, mind your place we design the chips. AMD asked for a license to the designs so they could do the changes themselves and Intel said no. That is not how patents work in the US, if someone wants to license from you, you must license at a reasonable rate. Intel lost because intel wanted a monopoly and refused to license a patent, they gained the ability to keep doing so in court because they tried to do it the right way and Intel broke the law.

 

[HairyLobsters]

Why would you build a foundry in Arizona, where water is scarce?

 

[Double-Click]

I love how USA laugh at socialism. This time with a 6.600.000.000$ grant guffaw and a 5.000.000.000$ loan smile.

I love how you took the time for a stereotyped pot-shot while glazing over the bigger picture at hand which frames it.

 

[Patriot]

Why would you build a foundry in Arizona, where water is scarce?

Yeah... sigh, tax breaks. They can recycle/reuse a lot of the water but foundries still demand a lot of water.

 

[Wirko]

That is not how patents work in the US, if someone wants to license from you, you must license at a reasonable rate.

Generally, you have no legal obligation to license your IP to any other party. The 80386 was a special case, it had strategic importance.

 

[Minus Infinity]

Here's how I see it, and this is IMHO....
TSMC is primarily based in Taiwan, if China decides...yea, then there would likely be some sort of impact from China on TSMC and trade with the US. If we have a foundry over here in the US, this may reduce that likelihood... at least that's what I think they might be thinking...but I'm sure there's money in it for them somewhere.

Basically given the consequences and extreme cost to the world of China invading Taiwan, $11.6B by US government is peanuts to help establish TSMC foundries in US. Also given Taiwan's geophysical problems with earthquakes and hurricanes, also smart o be establishing FABS elsewhere. I just wish our braindead country would entice high tech chip making to Australian shores.

 

[Six_Times]

Gotta keep Paul and Nancy happy.

 

[GodisanAtheist]

The level of ignorance in here is kinda shocking. The world's semicondutor manufacturing is basically all 50 miles away from China in a country China considers it's own territory but cannot have for practical reasons.

Even if China invaded Taiwan and lost, the world economy would be toast for a good long while.

While I don't agree with many of the billions the US does and does not spend, this is a smart strategic investment.

Also, as far as Intel is concerned, yes they can fab more of their own chips but again in a scenario where the US needs to get chips (maybe clean, domestic ones for strategic purposes) then it behooves us to have an American company with American fabs producing American chips. If AMD still owned Global Foundries, you'd bet your ass they'd be getting some of this cheddar too.

A potential (unlikely but potential) bonus of all this extra fab capacity is cheaper electronics for a while as Intel and TSMC over produce (just like our Farm Bills have farmers overgrow crops to ensure there are no shortages) and drive prices down.

 

[damric]

"...more borrowed money, more borrowed time."

 

[Double-Click]

Gotta keep Paul and Nancy happy.

Use your own head to find your way out of life's paper bag, not drivel being fed to you.

 

[remixedcat]

hey west virginia can use some of this too! we got tons of cheap land and broadband is expanding as well as new highway projects as well! ohio can have intel we can have tsmc! plus our grid here is less stressed than virgina is too.. I know several good spots around parkersburg, wv where I live that have multiple broadband providers and both zayo and att pops and are way above flood plains and everything...

hire me as the site selector lol

 

[DaemonForce]

A TW superpower asset in the US....I just don't understand what that level of brain drain is going to do to that part of the world. It's not just an incentive to build fabs here but to get TWs to live and work here too. These kinds of specialty jobs tend to be insular and I seriously doubt they're going to the Americans.