- Tram Ho
TSMC is the world’s largest chip manufacturer, with its headquarters and factories located in Taiwan. Major customers of TSMC include Apple, Qualcomm and Huawei. Moreover, TSMC is ahead of its competitors in adopting a new generation 5nm chip production line. Therefore the importance of this semiconductor manufacturer can be clearly seen.
In March, there were reports that TSMC was considering building a chip factory in the US. The Trump administration has put pressure on TSMC, because the production lines are based in Taiwan but still use some of the core US technologies.
According to a Wall Street Journal report, TSMC is ready to announce the construction of a multi-billion-dollar 5nm chip factory in Arizona. This plan is in keeping with the American will, which is to end its reliance on chip factories in Asian countries.
The report says that TSMC will likely make an official announcement on Friday, after holding a board meeting yesterday. TSMC will start manufacturing chips in the US in 2023, and all production lines will be based on the 5nm process. TSMC has recently started producing 5nm chips, and the iPhone 12 5G launched this year is likely to be the first smartphone to be equipped with 5nm chips.
TSMC pleases President Trump in return for continued cooperation with Huawei
Accepting the construction of a new plant in the US could cost TSMC billions of dollars, along with operating costs many times higher than the factory in Taiwan. However, pleasing President Donald Trump may help TSMC achieve other goals. And those purposes are all related to Huawei.
The Trump administration wants TSMC to obtain an export license from the United States before supplying chips to Huawei. These chips are designed by American technologies, which is why the Trump administration can put pressure on TSMC.
Besides, the US also considers changing the rules of Foreign Direct Investment. The new code will allow the US government to control exports of products made overseas, if they are made up of 25% or more of U.S.-originated parts. Therefore, the US government will be in control of TSMC’s supply of chips to Huawei and stop that.
Huawei is TSMC’s second largest customer, with revenue from Huawei reaching 5.1 billion USD last year. With just a snap, President Donald Trump can turn that $ 5 billion in steam. That’s why TSMC wants to please the Trump administration, so that it can negotiate continued cooperation with Huawei.
TSMC once said that if it loses its customer, Huawei, they will not be able to build a new chip factory in the US.
Source : Genk