TSMC’s new chairman, Mark Liu has stated that expanding foundry capacity in the US and Europe is going to be a non-profitable venture. Indirectly referring to Intel’s plans to expand its foundry capacity in Arizona and Ireland, Liu said that the United States’ (and Europe’s) plans to expand semiconductor fabrication capacity locally to meet their need would be “economically unrealistic”.
Mark Liu was recently elected as the new chairman of the Taiwan Semiconductor Industry Association (TSIA). Speaking at the event he said that the present semiconductor shortage is not normal and the existing foundry capacity should be more than enough to satisfy demand. He blamed the pandemic and the US-China trade war for the shortages, stating that the political isolation of major players has led to an environment of uncertainty and affected the supply chain adversely.
As per Mr. Liu, if the entire supply chain was shifted to the United States and Europe, or if the two regions created their own separate supply chain, it would result in large amounts of “non-profitable” capacity. This comment comes shortly after Intel decided to re-commit itself to its foundries, calling the new plan IDM 2.0. The Santa Clara-based chipmaker which also happens to be one of the only self-sufficient semiconductor companies in the US will be building multiple new foundries in Arizona and Ireland with a total investment of more than $20 billion. The new fabs are slated to go live in 2023 and focus on the production of 7nm wafers.
Lately, the US has been working to tackle China’s run to semiconductor self-efficiency with rather unethical bans and sanctions on various local companies. At the same time, the new Biden administration has announced multiple relief funds to address the present chip shortages and rejuvenate the American chipmaking industry. However, Taiwanese foundries (TSMC) and backend designers continue to be the industry leaders and that is unlikely to change anytime soon.