TSMC went to the United States to set up a factory. It wanted to turn back, but the Chinese chip blocked its way
TSMC used to hype about setting up factories in the United States. Today, however, TSMC suddenly found that setting up factories in the United States was a big hole and tried to return to the Asian market. However, it may not be able to achieve all this, because Chinese chips have blocked its way.
TSMC went to the United States to set up a factory. It wanted to turn back, but the Chinese chip blocked its way
1、 It’s a pit to set up a factory in the United States
TSMC has said that the loss of orders for Chinese chips will not affect it. However, the situation since last year reflects that the impact has exceeded its expectations. First of all, TSMC has lost its bargaining power. Without the balance of Chinese chips, American chips have rejected the price increase of TSMC, resulting in that the cost increase of chips can only be borne by itself.
Secondly, there is no pressure from competitors. The interest of American chips in adopting advanced process is weakening. Apple’s A16 processor gave up the 3nm process last year, and only two of the four iPhone14 models last year used A16 processor, while the other two iPhone14 models continue to use the old A15 processor.
Once again, it is completely controlled by American chips – American chips contributed nearly 70% of the revenue to TSMC, and finally went to the United States to set up factories under the influence of the big stick and carrot of the United States, and the cost further increased by 50%. However, just as the American chips mentioned above will not bear the rising cost, which will further squeeze the profits of TSMC. Under the loss of profits, TSMC plans to reduce its R&D investment this year.
Finally, setting up factories in the United States may lead to the loss of technology and talents of TSMC. As the technical backbone and equipment of TSMC are shipped to the United States, the technical secrets of TSMC may be further learned by the United States, while the United States attempts to hand over these technologies to Intel, a local chip company in the United States, which will further create these competitors, and TSMC’s technological leadership will be weakened.
TSMC went to the United States to set up a factory. It wanted to turn back, but the Chinese chip blocked its way
With the fact that TSMC went to the United States to set up a factory, the United States also began to expose its face. Finally, the subsidies promised by the United States were significantly reduced, and the subsidies to TSMC were only 10%. American investment institutions that had been optimistic about TSMC before also began to sell off. Buffett reduced the 90% of TSMC’s shares, and many American investment institutions have reduced their holdings. Zhang Zhongmou said that “the United States should increase its investment in TSMC”, However, the US approach has become so obvious that foreign media believe that as the US plot becomes reality, the US has begun to abandon TSMC.
2、 TSMC turned around
The first signal of TSMC’s turning back was to mass produce 3nm in Taiwan, China, China, at the end of last year, and held a rare mass production ceremony for 3nm process, which was not the case for the mass production of the previous advanced process. TSMC’s move was to declare to relevant parties that its focus is still in Asia.
TSMC took the lead in mass production of the most advanced 3nm in Taiwan, China, China. It should hope to ensure that the advanced technology is still in its hands. However, until now, only Apple plans to use TSMC’s 3nm chips in the United States, and Apple will not use A17 processors for all this year’s iPhone15, while only half use A17 processors, which means that TSMC’s 3nm capacity utilization rate will be low.
TSMC went to the United States to set up a factory. It wanted to turn back, but the Chinese chip blocked its way
Another heavy pressure of American chips on TSMC is that Apple, Qualcomm, NVIDIA and AMD are all cutting orders, resulting in a significant decline in the capacity utilization rate of TSMC’s 7nm and 5nm processes. The industry speculates that the capacity utilization rate of TSMC’s 7nm process is only 50%, and the capacity utilization rate of 5nm process is reduced by 20%.
Faced with the practice of the chip industry in the United States, TSMC began to restart its capacity expansion of 28nm process, build 28nm production lines in Taiwan, China, China, and expand 28nm capacity in its factory in Nanjing, Chinese Mainland. It hopes to seize the market with mature process capacity, especially in Chinese Mainland.
When the demand for advanced process chips declined, the chip industry in Chinese Mainland remained prosperous. The demand for chips in home appliances, automobiles and other industries surged due to intelligence, and these industries had more demand for chips with mature processes. Because the cost of chips that become processes was lower, the performance could also meet the requirements of these industries. TSMC hoped to obtain more chip orders from Chinese Mainland to ensure revenue growth.
TSMC went to the United States to set up a factory. It wanted to turn back, but the Chinese chip blocked its way
Of course, TSMC also hopes to leverage chip orders from Chinese Mainland to balance American chips and tell American chips that its customers still have chips from Chinese Mainland to choose from. However, chip manufacturing enterprises in Chinese Mainland are now expanding 28 nanometer production capacity on a large scale. One chip manufacturing enterprise has four 28 nanometer factories under construction, and the demand for TSMC’s 28 nanometer process is not strong, After all, Chinese chips prefer to cooperate with local chip manufacturers to ensure the safety of production capacity, which leads to the awkward position of TSMC.