Apple has significantly increased its chip manufacturing operations in the U.S., specifically in Arizona, but TSMC’s CEO cautions that cutting-edge chips will not be made in the U.S. anytime soon. Here’s why.
TSMC CEO attributes compliance issues for US lag in advanced chip production
Apple’s chip supplier, TSMC, is in the process of constructing its third semiconductor factory in Arizona, spurred by significant funding from the U.S. CHIPS Act.
Yet, the CEO of TSMC has indicated that we should not anticipate the emergence of the most advanced technologies in the U.S.
Wen-Yen Lee reports for Reuters:
The new TSMC facility in the United States is unlikely to utilize the most sophisticated chip technology before its counterparts in Taiwan, primarily due to intricate compliance issues, local construction mandates, and various permitting processes, according to the CEO of the Taiwanese firm.
C.C. Wei, TSMC’s CEO and Chairman, noted that the timeline for constructing the new Arizona facility has at least doubled compared to similar efforts in Taiwan, highlighting specific hurdles the U.S. faces in re-establishing its domestic chip manufacturing industry.
“Every stage requires a permit, and once a permit is granted, the timeline at least doubles compared to Taiwan,” Wei remarked during a National Taiwan University event on Thursday. He emphasized that thus, it will be challenging for TSMC to deploy its latest technologies in the U.S. ahead of Taiwan.
TSMC consistently updates and refines its production techniques, and according to Wei, current regulatory standards in the U.S. do not permit swift adaptations to these advancements.
Therefore, despite the substantial $65 billion investment to construct three factories in Arizona, it appears that these new facilities will primarily focus on older technology.
Apple’s existing US chip production reinforces this assertion
This scenario has already occurred with Apple’s domestic manufacturing endeavors.
Currently, TSMC’s Arizona facility fabricates Apple’s A16 Bionic chip, introduced with the iPhone 14 Pro in 2022, and now featured in the standard iPhone 15 and 15 Plus models.
Additionally, the production of the S9 SiP from the Apple Watch Series 9 launched in 2023 has been incorporated.
While these chips are relatively new, they fall short of representing Apple’s most groundbreaking silicon advancements. The insights provided by Wei clarify the rationale behind this situation.
With the rapid advancement of AI technology and the rising significance of semiconductor manufacturing in the AI realm, there’s a possibility we may witness a shift towards increased U.S. investments in this sector.
What are your thoughts on TSMC’s CEO’s statements? Were they unexpected, or did they align with your expectations? Share your opinions in the comments.
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