back to article Uncle Sam courting Intel, TSMC to build advanced chip fabs on home soil – report

The US is reportedly in talks with Intel and TSMC to develop new chip factories on home soil due to supply chain concerns as well as the geopolitical threat posed by China. According to The Wall Street Journal, the Trump administration is also trying to convince Samsung to expand its existing facilities in Texas to encompass …

  1. Gene Cash Silver badge

    And how long does it last?

    When I bought my last phone (a Moto G), one of the decision points was the fact it was actually made in Ft Worth, Texas.

    7 months after I bought it, that plant was shut down. So much for helping support "American made"

    Also, wafer fabs are literally multi-billion dollar facilities now. If you can influence even 1/10th of a percent of that price, then you can have a say where it's built.

  2. ExampleOne

    While I may sympathise with the official objective of removing reliance on China, I can’t help but wonder if many countries outside the USA currently feel a reliance on the USA is a better option?

    1. LDS Silver badge

      Despite Trump and other issues, NATO countries and not only see USA a more reliable ally than China.

      If Trump is not the exception but the new normal, such thought will need to be reviewed....

    2. cirby

      You can certainly find politicians and fanatics who say they don't, but in reality they all know they trust the US more than China, by a huge margin.

      (Takes vacation to Disney World)

      "We can't trust the US!"

      (Flies to Boston for advanced medical procedure)

      "Who knows what they'd do?"

      (Checks NYSE on iPhone to see how their investments are doing)

      1. Duncan Macdonald Silver badge

        No need to be a fanatic to have little trust in the US.

        Look at the activities of the US against Huawei which seem to be caused by Huawei being cheaper and better than Cisco and not including any NSA backdoors. The threat of Huawei was not spying from China but the reduction in the ability of the NSA to spy on everyone.

        Look at the US actions in the Middle East, Panama and other areas to see that the US is a country that believes in the use of force anytime that it thinks it can get away with it.

        Look at the number of civilians that the US has killed in its wars in Vietnam and the Middle East (bombing a wedding party in Afghanistan being one example).

        Because the cost of getting elected to Federal office (Congressman, Senator, President or Vice President) far outweighs the salary from the office, most such officials have to obtain the money from sponsors (by altering laws in their favor or by arranging contracts and grants to go to them).

        The US has the best government that money can buy.

        1. Anonymous Coward
          Anonymous Coward

          [DM] "activities of the US against Huawei which seem to be caused by Huawei being cheaper..."

          Ummm... no... Huawei copying the motherboards & ROMS of Cisco and shipping photocopies of Cisco manuals with their product resulted in Huawei being cheaper.

          [DM] "and better than Cisco and not including any NSA backdoors"

          It was China that leaving unencrypted backdoors in the equipment.

          https://www.theregister.co.uk/2019/04/30/huawei_enterprise_router_backdoor_is_telnet/

          [DM] "US actions in the Middle East"

          Yep... [alqaeda] fly some airplanes into buildings and [saddam] signs 2 different executive orders to get terrorist organizations to kill Americans anywhere in North Africa and Middle East might just encourage some involvement & reassurance from allies that the U.S. is a true ally, even though enemies & terrorist sympathizers & cowards may think otherwise.

          [DM] "civilians that the US has killed in its wars in Vietnam"

          The Red Communists of North Vietnam invaded South Vietnam, until they were bombed, and decided to sign a peace treaty. They broke the peace accord and re-invaded again. Civilians would not have died in Vietnam had Red Communists not invaded and Red Communist Sympathizers not taken the side of the foreign invaders & murderers. Sure racists will tell you in a heart beat that the North was the same ethnicity as the South and had the right to invade & kill people who looked like them, but the South knew the results would be the same as what Hitler & Stalin did.

          [DM] "the cost of getting elected to Federal office (Congressman, Senator, President or Vice President) far outweighs the salary from the office"

          Which means you have to get the support of people to support you for office.

          This is why so many people hate Trump in the United States - he was able to get elected to office, spending half the money as his Wall Street & Tech Company & Big Business & Middle Eastern Oil competitor (Clinton)

          It is always amusing, to watch people on a foreign web take the position of Red Communists, Racists, Financial Firms, and wealthy Oil Dictatorships over freedom.

          1. IGotOut Silver badge

            "The Red Communists of North Vietnam invaded South Vietnam, until they were bombed"

            So as you see "Red" in a phrase, you know what you are up against.

            Can I suggest you go and study the Vietnam War in a little more detail, especially the pre war history.

            Hi Chi Min (as he was later to become) just wanted to have a country free of the imperialism of the French. The US originally supported his cause, but then changed their minds and sided with the French. He was not a die hard "commie" but just wanted freedom for his fellow countrymen, a thing the "north" and "south" both wanted. The US propped up a corrupt puppet government, so you then had the true "reds" team up with Ho's forces to try to overthrow the corrupt regime.

            If the US hadn't supported the corrupt regimes, the war may never have happened and the country wouldn't have been so hard line communist.

            As for 9/11 again do your history and find out who put the Taliban into power in the first bleeding place.

            The US has a good history of meddling in foreign affairs and making the situation far worse for their people.

            As much as I dislike Trump, the way he is dealing with Iran is better than others would of done (bomb and invade). Don't get me wrong, it's not a good way, but better than others would have done.

  3. Lorribot

    trust the US?

    Why would we trust teh US government when i doubt most the US population trust them. The curent Administration is selfserving in the extreme and cares little about other countries and in pinch would stop exports of chips if it served its own intrest.

    They should spread the sites globally so they do not rely on one pparicular region or state.

    1. Anonymous Coward
      Anonymous Coward

      Re: trust the US?

      That is exactly what the U.S. foreign policy driven by Tariffs is encouraging today - encouraging nations around the world, who want access to the U.S. market, to disperse their manufacturing from China.

      After all, the world was over-dependent upon the various 1 million person prison factories of China, where dissenters are given blood tests and have their organs removed from their living [soon to be deceased] bodies so they can profit from the wealthy who travel in to receive their fresh meat transplanted from non-ideologically aligned / compliant workforce.

      But, of course, some people prefer to keep the option for hearts, livers, and kidneys from those who do not make their android phones fast enough (because they are praying towards Mecca 5 times a day.)

      Lovely people, mates.

  4. Anonymous Coward
    Anonymous Coward

    Er, Strategic Policy?

    The sole reason why TSMC and it's Taiwanese peer companies are so good at semiconductor fabrication is because the Taiwanese quite rightly identified such expertise as being globally valuable and chose to become the best at it for geopolitical reasons. By being indispensable, no one (probably not even China) wants to upset the Taiwanese economy. Indeed, I recall years ago reading a column that reported that the Taiwanese self defence policy (publicly stated) was, "to blow up the semicon fabs the moment a Chinese solidier's boot sets foot on a Taiwanese beach".

    I think it highly, highly unlikely that Taiwan is going to let that expertise go to the USA. Partly because the USA signed up to agreements regarding helping guarantee Taiwanese security but then failed to fulfill them (something about supplying diesel subs I remember).

    Another country missing from this debate is Japan. Quite a lot of fab machinery is actually Japanese designed and manufactured. They may not be in the business of actually running large scale fabs, but I bet they could if they really wanted to. Given that Japan is another country recently to have become wary about the certainty of US security guarantees (Trump said "I'm bring the troops home, the Japanese have had free security for far too long", ignoring the fact that Japan pays for US forces to be based in their country), I can't see them being especially keen to let the US develop an independent domestic capability either.

    It sounds like the US is saying, "give us something for free". I don't think it's going to be handed over on silver plate, wrapped in gift paper and tied up with a ribbon.

    1. Reg Reader 1 Bronze badge

      Re: Er, Strategic Policy?

      Great comment. I hadn't considered that issue for either Taiwan or Japan.

    2. Anonymous Coward
      Anonymous Coward

      Re: Er, Strategic Policy?

      Fujitsu of Japan engaged Taiwan to start producing chips, at their fabs, not too long ago, as well. South Korea, Japan, and Taiwan are becoming more interdependent. The U.S. does not force transfer of intellectual property from U.S. Asian partners, like China does to them & the U.S.

      Trump knows the U.S. is an unreliable partner because of politics (i.e. Democrats in U.S. Congress went to the defense of South Vietnam with a Democrat President, when the North Vietnamese invaded the south... then the Democrats in the U.S. Congress refused to supply the Air Support for South Vietnam after the North re-invaded them again under a Republican President... liberals can never be trusted in life & death situations.)

      This being said, Trump wants South Pacific nations to really be more than ports for the U.S. ships to dock at, in order to retain security. Japan is deploying Helicopter carriers now and Hypersonic Missiles in a short number of years. Taiwan is buying equipment that can repel a naval invasion (quickly mobile tanks to fire on incoming ships & avoid incoming fire, mines to destroy incoming ships, anti-missile batteries to stop incoming attacks, mobile systems to fight a guerilla warfare against Mainland Chinese invaders, etc.)

      Trump no longer desires Asians to be slaves of the United States, as liberals once desired, but rather he wants them to become true peers & allies, capable of defending their own nations.

      There are a lot of people, who prefer U.K., Europe & Asia to be the security lackies of the United States - Trump has no taste for that. He prefers them to be strong & independent... true peers in every sense. (A lot of overseas cowards and U.S. racists prefer to see them as lackies without ever achieving peer status.)

      If Taiwan can make money on their island, as well as on U.S. Mainland, it will offer more opportunities for them to make themselves militarily independent and also place them in a better position to provide chips for their own military solutions and economic funding, in case of a Chinese Blockade or engagement. (Multiple sourcing is an important concept in the U.S. Military Contractors.)

  5. John Savard Silver badge

    Missed Opportunity

    There was a short time under the Clinton administration when Russia was friendly with the United States under Boris Yeltsin, and China's sole nuclear-armed submarine was in port for repairs. But we missed the opportunity for a pre-emptive strike followed by regime change in China. Then, with the threat from China eliminated, Russia and India could have given up nuclear weapons - and Pakistan would no longer need them to keep up with India. The world would have been saved from the threat of nuclear war, with all nuclear weapons in the hands of responsible countries - the United States, Britain, and France - and there would no longer have been any threat against Taiwan.

    1. martinusher Silver badge

      Re: Missed Opportunity

      The problem with 'regime change' in China is that the idea isn't actually that new, we've been meddling in China since at last 1850 and all the Chinese got out of it was exploitation, conquest and the inevitable millions of casualties, widespread poverty and so on. Attacking them in the 1990s would have been just 'more of the same' to them -- a society that's 5000 years old can afford to be patient.

      China's 'threat', such as it is, is economic. They're good at what they do. We have two ways to respond to this. One is to play 'Age of Empires', a game they're probably more familiar with than we are. The other is to stop messing around and compete with them as peers, something that might involve investment in education, infrastructure and all sorts of other things that we've tended to skip because it eats into (short term) profitability.

      Try thinking in terms of an international sports league rather than a clash of empires.

      1. Anonymous Coward
        Anonymous Coward

        Re: Missed Opportunity

        China's economic "threat" (if it is that) is entirely of our own making. China has such industrial muscle because we've all outsourced a large fraction of manufacturing industry to them. It's us who are giving them the money to grow. They might be playing a little fast and loose in some countries with weak governments and bountiful resources, but they're not these days invading countries and making off with the loot. We're all simply voluntarily handing the loot over in return for cheap goods we can't be arsed to make ourselves for the cost we're prepared to pay.

        1. Glen 1 Silver badge

          Re: Missed Opportunity

          China is big enough and has the population and natural resources to be a superpower in its own right once it has teched up - without any economic flexing. The west didn't 'give' them money, we bought stuff. Companies set up there because it is/was cheaper, worshiping at the altar of profit.

          The Chinese understand that economically intertwining economies makes it... disadvantageous for the US to rattle sabres *too* hard. At least until China thinks it could confront the US outright. They have their own space program, does anyone doubt they could put a nuke anywhere on the planet should they feel so inclined?

          Look at the trade delegation the UK was going to send to China. Cancelled when it was announced we were going to send our carrier to join the US's 'freedom of navigation' sabre rattling exercise.

    2. seven of five Silver badge
      Stop

      Re: Missed Opportunity

      That is so wrong, I fail for words.

      1. Youngone

        Re: Missed Opportunity

        John Savard might be one of those people who think the US defeated the Nazis.

        He might also think the US could defeat China in a war, which they can't.

    3. onemark03

      Re: Missed Opportunity

      @ John Savard:

      Come on, mate, you don't really believe Russia would have voluntarily given up its nuclear weapons, do you?

    4. IGotOut Silver badge

      Re: Missed Opportunity

      @John

      You're kidding right?

      The US couldn't beat a few million in Vietnam & Korea.

      How do you fancy taking on the world's largest standing army

      Russia didn't beatthe Nazis because they had the best tech, but because they were willing to lose 10 to 1?

      Sure kill a few million "just in case", but soon as a few thousand are killed on US mainland soil, things would seriously change.

  6. IGotOut Silver badge

    Eh?

    "The over-reliance of TSMC on Taiwanese factories is a concern to US officials....."

    There may be a teeny clue in the name.

    Taiwan Semiconductor Manufacturing Comany.

  7. Anonymous Coward
    Anonymous Coward

    Aren't the Intel fabs mainly in the US already?

    So far as I know most Intel fabs are in the US, a handful in Israel and the odd one in Ireland and China.

    I guess Intel want another handout

    1. EnviableOne Silver badge

      Re: Aren't the Intel fabs mainly in the US already?

      well they need something from somewhere, they can't get anything below their 14nm process to work, TSMC are running 10,7 and gearing up on 5nm

      1. bazza Silver badge

        Re: Aren't the Intel fabs mainly in the US already?

        Yes indeed, it seems as if Intel have hit a brick wall on their silicon processing know-how.

        I'd read that Intel's 10 is akin to TSMC's 7. However, if TSMC move smoothly down to 5nm and Intel still can't make their 10nm work, there's a good chance that the US would fall permanently behind the curve forever being one step behind.

        What About the Shareholders?

        One might read into this situation the possibility that Intel has told the US gov that they've hit a brick wall and they can't see a way of resolving it. If so, I wonder if their shareholders would like to know that too???

    2. David Halko

      Re: Aren't the Intel fabs mainly in the US already?

      -- Intel want another handout

      Taiwan Semiconductor was created when multiple chip manufacturers approached the Taiwanese Government for a handout, they basically told them no money was available for a bunch of little fabs, but they would make billions available if they all joined together - and they accepted the handout and this is where they are at today.

      Fabs are so expensive that either huge multinationals must build them (which fewer can) or only governments can fund them.

      Welcome to the world of nano-computing.

  8. hoola Bronze badge

    What about the costs?

    Unless the US government is going to heavily subsidise this then why would Intel move production back? I am sure that the current administration is quite capable of committing billions to do something like this but it will take time to get online and for Intel, what do you build? They are stuck between different wafer thicknesses, at the dog end of one and desperately trying to get 7nm to 10nm to work.

    I am assuming the production costs are also higher unless POTUS is planning on further hitting their workforce by pushing wages to Chinese levels.

    Given that everything in the West is geared to the lowest possible cost regardless of longevity of the product and maximum profit in the shortest time I am not sure it will work.

    1. Anonymous Coward
      Anonymous Coward

      Re: What about the costs?

      Semiconductors are not a manual labor oriented business. It is mostly robotics in a clean-room.

      The difference now is investment in robotics and the business cases to keep it going for 5 or so years.

  9. nerdbert

    There are costs, and there are related costs

    People tend to think of only immediate costs. This is a mistake. For example, as Andy Grove will tell you, there is tremendous value in knowing how things are actually manufactured when you are designing things to be manufactured, even if most of the work is done overseas. Trying to figure out if the idea you have will scale into something big requires you to consider something beyond the mere invention of a thing, and to figure out how to scale that thing to production. I know in semiconductors that the US has lost a tremendous advantage in having an intimate knowledge of how things are done as most of the fabs have gone overseas or to foreign investors.

    And that is without considering just what a shooting war in Taiwan would do to semiconductor supplies worldwide, and the impact it would have on the US's technology dependence. It seems to me that tariffs and other costs would be the equivalent of an insurance policy against rogue nations. After all, China not too subtly threatened the US drug supply when the US criticized the CCP's handling of the recent virus.

    1. Glen 1 Silver badge

      Re: There are costs, and there are related costs

      INdeed. If I recall correctly, Edison was known for patenting not just the invention, but the processes/machines with which the inventions were manufactured

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