TSMC founder Morris Chang recently told a forum hosted by Taiwanese media outlets that the success of TSMC will not be easy to replicate or transplant elsewhere – including in the United States. He spoke about challenges for the company’s planned, new $12 billion fabrication plant in Phoenix, Arizona.
Chang highlighted the attitude of the Taiwanese working class, as well as the island’s plentiful source of “high-caliber, industrious talent devoted to the chip sector” while reportedly pointing out a comparative lack of talent in the U.S. manufacturing sector. He said products made in the U.S. would still be burdened by higher costs, even after federal and state governments had each contributed hefty incentives to make the Arizona facility possible.
According to a transcript of his speech viewed by Asia Times, Chang said, “The United States stood out for cheap land and electricity when TSMC looked for an overseas site, but we had to try hard to scout out competent technicians and workers in Arizona because manufacturing jobs have not been popular among American people for decades.”
Chang also cautioned about having Taiwanese managers run overseas plants. “Computers of different brands can often be hooked together but not people of different cultures……the fact that TSMC’s executives can deliver top results in Taiwan is no guarantee of similar performance when they are posted overseas.”
Chang said the battle for global chipmaking leadership was currently between Taiwan and South Korea and that despite China’s huge state subsidies, TSMC’s research and manufacturing capabilities keep it five years ahead of SMIC and its Chinese peers.
In related announcements, the Taiwan Minister of Economic Affairs reported that TSMC’s most advanced technology would be staying in Taiwan.
“Regardless of whether TSMC establishes production facilities or pursues cooperation in Europe (or – IFTLE assumes the US), Taiwan will remain the home base for its most advanced technologies,” Wang told a joint meeting of the legislature’s Economics Committee and Judiciary and Organic Laws and Statutes Committee.
TSMC sets 2021 capital target at $30B
During a recent conference call with analysts, TSMC raised its 2021 capital expenditure target to $30 billion after customer demand exceeded the company’s expectations.
About 80% of the budget will go to leading node technologies, including 3nm, 5nm, and 7nm, with 10% earmarked for advanced packaging and mask making, and about 10% for specialty technologies. TSMC will ramp up its 4nm process (a 5nm extension) during the second half of 2021, and start volume production in 2022. The company will initiate 3nm commercial production in the second half of next year.
Reports are that TSMC currently holds ~56% of the worldwide foundry business with Samsung holding 18% which is just about equal to GlobalFoundries, UMC, and SMIC combined (#3,4 and 5 ).
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Morris Chang ( Photo Credit: Stringer/Imaginechina via AFP)
