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Meanwhile in China


RPM

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China's no longer a low-cost manufacturing nation for many of the products that the US shifted over there during the past 2-3 decades.  And American companies have been starting to move manufacturing out of China for several years now, the pandemic exacerbated the problems and sped up the timelines for many of those companies.

But it took decades to get here and it'll take the same to unwind it.

 

 

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25 minutes ago, utee94 said:

China's no longer a low-cost manufacturing nation for many of the products that the US shifted over there during the past 2-3 decades.  And American companies have been starting to move manufacturing out of China for several years now, the pandemic exacerbated the problems and sped up the timelines for many of those companies.

But it took decades to get here and it'll take the same to unwind it.

 

 

Yep. The great hedging has been in full swing at my company for at least three years. 

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On 4/5/2024 at 1:50 PM, utee94 said:

American companies have been starting to move manufacturing out of China for several years now, the pandemic exacerbated the problems and sped up the timelines for many of those companies.

But it took decades to get here and it'll take the same to unwind it.

It’s going to take a while, but it’s happening

https://www.engadget.com/tsmc-snags-66-billion-in-chips-act-funding-to-open-three-factories-in-arizona-165945639.html

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Taiwan Semiconductor Manufacturing Company (TSMC) is receiving $6.6 billion in grants to build three fabrication plants, otherwise called fabs, in the region of Phoenix, Arizona. This is in addition to around $5 billion in government loans.

As part of this deal, TSMC agreed to expand its planned investment in Arizona by $25 billion, to $65 billion. The company already announced two of the three factories it is building in the state, with a third promised by 2030. The White House says this represents the largest foreign direct investment in Arizona’s history, with expectations to bring 6,000 high-wage tech jobs and 20,000 construction jobs to the state.

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One nifty aspect of these factories is that they’ll allow TSMC to complete every aspect of the chip-making process on US soil, including advanced packaging. I’m not talking about slapping a box and warranty information around the chip. In this context, packaging refers to arranging the various components to build the final product, in addition to adding power, inputs and outputs. As things currently stand, even components that are made in America are sent back to Taiwan for packaging and then mailed across the world yet again for the final sale. These Arizona factories will, eventually, put a stop to all of that jet-setting.

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Once all three factories are humming along, they will reportedly manufacture tens of millions of chips to power products like smartphones, autonomous vehicles and, of course, AI datacenter servers. Future iPhones and Macs will use 4nm and 3nm chips made at the Phoenix plants, thanks to a partnership with Apple. TSMC has already reported some delays with the first two factories, but the current plan is for the first fab to be fully operational by next year, with the second to follow in 2028 and the third by 2030.

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The federal government suggests that the US will manufacture 20 percent of the world’s leading-edge chips by 2030. “America invented these chips, but over time, we went from producing nearly 40 percent of the world’s capacity to close to 10 percent, and none of the most advanced chips, exposing us to significant economic and national security vulnerabilities”

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One of the main goals of the CHIPS Act is to lure global chipmakers to build on US soil, and it looks like it’s working. Last week, Samsung announced it would be doubling its investment in Texas to $44 billion, with plans for an ambitious expansion. The multinational semiconductor company GlobalFoundries received a grant of $1.5 billion to help pay for a new fabrication facility in New York that will handle the manufacture of chips for the automotive, aerospace, defense and AI industries. Intel recently received the largest CHIPS grant to date, snatching up to $8.5 billion to continue various US-based operations.

It’s going to take time, but at least we are on the right path.  

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20 minutes ago, wild_turkey said:

Possibly a stupid question, but I’m curious why TSMC would invest in fabs in Arizona, given that semiconductor fabs require lots of water? Are there not better geographic options?

Now that the state is ending the leases from the Saudis to grow alfalfa in Arizona and ship it back to Saudi Arabia, maybe there’s some water that’s become available. 

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Possibly a stupid question, but I’m curious why TSMC would invest in fabs in Arizona, given that semiconductor fabs require lots of water? Are there not better geographic options?

In addition, Taiwan being the supplier of the most and best silicon, making them a priority for foreign protection…why would they give away some of that leverage?
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In addition, Taiwan being the supplier of the most and best silicon, making them a priority for foreign protection…why would they give away some of that leverage?

Well that part makes sense to me. Taiwan would develop a better partnership with the U.S. in hopes that we would provide military protection when the time comes. And the fact that we are a major purchaser of their chips, and the $6B incentive we offered.

But why Arizona? Why build new fabs in the part of the country that is most starved for water?
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On 4/8/2024 at 9:43 PM, atomheartbevo said:

It’s going to take a while, but it’s happening

https://www.engadget.com/tsmc-snags-66-billion-in-chips-act-funding-to-open-three-factories-in-arizona-165945639.html

It’s going to take time, but at least we are on the right path.  

I think that a spotlight on the vulnerabilities to our national defense and economic interests we’re given a kickstart by Russia’s invasion of Ukraine - and our realization that a few bad actor states can cause horrific damage to the world’s economy, and that the fallout of that damage can lead to political unrest and a change in leadership to people favoring the bad actors.  

When you look at how the combat drone effectiveness is limited by chip availability, and then look at how we do not have a robust domestic chip manufacturing technology in our country, well, that has to give you pause - and a new found desire to make sure the USA has the native industries required to defend our country in future fights. 

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15 hours ago, Walser said:


In addition, Taiwan being the supplier of the most and best silicon, making them a priority for foreign protection…why would they give away some of that leverage?

So the owners can get US Visa's and bug out of Taiwan before China blows it up?

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On 4/10/2024 at 8:57 PM, wild_turkey said:

Possibly a stupid question, but I’m curious why TSMC would invest in fabs in Arizona, given that semiconductor fabs require lots of water? Are there not better geographic options?

Cheap land, tax incentives and cheap electricity. Data centers, which are energy hogs, are also popping up in AZ.

The fact that Phoenix (before semiconductors) grew made little sense. I thought it was a place for snowbirds who needed healthcare, which needed infrastructure, which needed people, which needed commerce, and it just spiraled up from there.

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