Thursday, April 21st 2022
TSMC Founder Says Growing Domestic US Chip Production is Wasteful and Expensive
According to an article over on The Register, the TSMC founder, Morris Chang, isn't overly impressed by US efforts to grow its domestic chip production. In a podcast hosted by the Brookings Institution, Morris Chang said that the US' attempt to grow its domestic chip production will be "a wasteful, expensive exercise in futility." The reason behind his comment is that he believes the US is lacking the talent to work in the fabs, or possibly the willingness to work triple-shift to keep the fabs running 24/7, unlike the Taiwanese. Furthermore, he states that the US can't compete in terms of cost, as he claims it's 50 percent more expensive to manufacture chips in the US compared to Taiwan.
It should be pointed out that Morris Chang is no longer involved with the day to day operations at TSMC and the above are just his opinion. When questioned about why TSMC is building a fab in Arizona, Chang said that TSMC decided to do it because they were urged to do so by the US government. He also believes that despite government subsidies, the US is unlikely to become self-sufficient when it comes to semiconductors, especially as the cost per chip will be much higher, which will make it hard to compete internationally. However, he does mention that if the PRC decided to start a war with Taiwan, then the bet is likely to pay off for the US, but there are obviously other problems that such a situation would bring as well. Chang also praises US chip design talent and says that Taiwan has very little talent in comparison and that TSMC has none. However, the latter doesn't seem to be entirely true, based on the fact that TSMC is helping its customers to optimise their designs for the various production nodes at TSMC. For those interested, the podcast can be found below.
Source:
The Register
It should be pointed out that Morris Chang is no longer involved with the day to day operations at TSMC and the above are just his opinion. When questioned about why TSMC is building a fab in Arizona, Chang said that TSMC decided to do it because they were urged to do so by the US government. He also believes that despite government subsidies, the US is unlikely to become self-sufficient when it comes to semiconductors, especially as the cost per chip will be much higher, which will make it hard to compete internationally. However, he does mention that if the PRC decided to start a war with Taiwan, then the bet is likely to pay off for the US, but there are obviously other problems that such a situation would bring as well. Chang also praises US chip design talent and says that Taiwan has very little talent in comparison and that TSMC has none. However, the latter doesn't seem to be entirely true, based on the fact that TSMC is helping its customers to optimise their designs for the various production nodes at TSMC. For those interested, the podcast can be found below.
56 Comments on TSMC Founder Says Growing Domestic US Chip Production is Wasteful and Expensive
In a way I guess he's looking down on the Taiwanese, since they're apparently only good enough to make things for others.
So ability to get chips > efficiency in making chips.
Futhermore,The average person is commonly confused with skill and talent, both can be trained but only a trained skill can give the illusion of talent to those are not skilled in the same trade environment. I've seen people that are brilliant mechanics on paper, but when it comes down to actually working, they miraculously digress into stupidity. I've also seen the opposite at true too.
I see no reason why the US cant step up to the plate on this, its not pure rocket science. Since it takes money to make money, I think they should implement some skilled education for those that have comprehension of what they are getting into on that.
America has Reserved 1000's of Green Cards for TSMC Employee's in case of PRC invading Taiwan.
Getting Skilled Workers is Easier than Setting up and or expanding a Foundry.
US has to have chips to power the economy, and they have to be able to guarantee their supply. Intel is only second to TSMC; Europe, Africa, Asia, Russia, China (yet) don't have anything close to Intel or TSMC in terms of capability, and are trying to desperately develop them despite inefficiencies and being behind for the same reason.
As the US Gov't your options are:
1) develop your technology and subsidize the high costs. or
2) let your technology die in the name of efficiency and hope that nothing bad happens to Taiw... ahem the "Republic of China", and that your supply of chips is uninterrupted by pandemics, foreign government, wars, trade disputes etc.
Not to mention as Taiwan's and other Asian economies mature, the costs of manufacturing there will also increase, so any efficiencies stemming from lack of quality of life or manufacturing salaries are temporary.
It's like the crap the gov is pulling with getting behind the US legacy automakers Ford and GM, touting how they are leading the US revolution in EVs, which is a literal joke. GM sold 26 ev cars in Q4 2021, and Ford's EV sales dropped 46% in Q1 2022, and the gov is pushing these two as the leaders. Meanwhile the real leader reported 30%+ gross margin for Q1 2022 when Ford and GM have 0% margins for auto sales. They make almost zero profits selling vehicles and instead the real profits come from post sales and financing, ludicrous.
Yep gov picking winners hardly ever works long term it's just a tax money dumping ground to and for the already rich Solyndra solar power company come to mind :laugh:
- Decrepit old, rich, clueless guys that think they can/will influence the PRC or their decisions or the market in general... they suck
- Any company or government that lets politics impede or interfere with progress and/or improving the quality of life for everyone.. they suk
- Anyone who does not firmly believe in diversification and self reliance.. they suk
- Politicians... they suk..
'nuff said :DThe UK average salary is over 10k higher. I think US is higher still.
I'll be honest here, it sounds like talent is talent. That said, it it not. What he could have said more accurately it:
"The US doesn't have the manpower and labor history required to manufacture in the same way that Taiwan does. Conversely, Taiwan doesn't have the design skills to make that fabrication capability into anything useful."
Let me start this conversations by starting.
1) Raw materials are mined and converted - see: very low skilled countries
2) Machines are made, to turn those raw materials into complex goods - see: Germany (where EUV machines are fabricated)
3) Engineers design the complex goods - see: The US
4) Low paid, but highly educated areas manufacture the complex goods - see: Taiwan
1 exists to be low cost, high risk, low skills, and high labor. 2 exists to be high cost, low risk, high skills, and moderate labor. 3 exists to be high cost, low risk, high skills, and low labor. Finally, 4 is low cost, low risk, high skills, and moderate labor. Notice none of this overlaps.
The "burn" here is that the US doesn't make anything anymore. They can't compete against the skilled laborers from other countries, because they cost too much. The counter-burn is that Taiwan has labor but no ability to design. Both are useless without the other.
My $0.02 is that this is correct, if a bit simplistic. I've worked at plenty of places with three shifts...but when you think about the US it's difficult to equate that to how many people work "banker hours." I think this is just a myopic view of a country that is much bigger than people think, especially when you're comparing to an island nation...that was taken over from the natives after the CCP won the civil war post WWII.
It's hard, but go to Europe. Go to Taiwan. Ask them what the "average American" is...and be surprised. Sometimes a lot of the truth is lost when people aren't willing to understand that LA, Chicago, Detroit, Tulsa, Boise, and Ore are all cities amongst the same country. What do all of these cities have in common...? Basically nothing other than being in the same country. Despite this, people believe they "understand" America. It's the same jangoistic idiocy that leads people in the US joking about Russia being composed of bears on unicycles.