TSMC founder Morris Chang has stated that building a semiconductor supply chain that’s fully onshore (on US soil) is not possible, even if the US government decided to spend hundreds of billions of dollars on it. This statement comes as US lawmakers plan to invest $52 billion in the American chipmaking industry after calls of self-reliance from CEOs like Pat Gelsinger.
If you want to reestablish a complete semiconductor supply chain in the U.S., you will not find it as a possible task. Even after you spend hundreds of billions of dollars, you will still find the supply chain to be incomplete, and you will find that it will be a very high cost, much higher costs than what you currently have.
In the past, companies in the U.S. or in Asia were growing and prospering thanks to globalization and free trade. Well, Tom, the world is not flat anymore. This is going to be a challenge for the Asian semiconductor industry, global semiconductor industry, including Intel.Morris Chang, TSMC founder
At present, the US accounts for just 12% of the global semiconductor supply chain, down from 37% in the 1990s. Taiwan, followed by China and Korea handle the bulk of it due to cheap labor and other economic factors. Chang seemed adamant that moving the supply chain to America was financially undesirable, even if the US government spent a lot more than the presently allocated $52 billion.
He took a shot at Intel CEO Pat Gelsinger (indirectly), saying that people advocating for moving the semiconductor manufacturing to US soil are driven by self-interest. Gelsinger has been very vocal in his support for home-manufactured chips, pressurizing the US government for additional funding.
To be completely frank, Chang isn’t wrong. Intel has been struggling with manufacturing for several years now. TSMC has been at the cutting edge for a while now, stealing customers like Apple from the American chipmaking giant. Even today, Intel’s finest node (7nm) is inferior to TSMC’s N5 (5nm) process node used by Apple’s M1, M1 Pro, and Max SoCs.