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[12Goblins]

Chip shortage highlights U.S. dependence on fragile supply chain

Seventy-five percent of semiconductors, or microchips — the tiny operating brains in just about every modern device — are manufactured in Asia. Lesley Stahl talks with leading-edge chip manufacturers, TSMC and Intel, about the global chip shortage and the future of the industry.

www.cbsnews.com

Excellent 13 minute video segment by 60 Minutes covering the global chip shortage

What struck me most is CEO of Intel (only remaining chip maker in the US) saying they don't currently have the "know how" to manufacture the highly sophisticated chips that Apple, etc need, and so have to depend on Asian countries - where 75% of the microchips are currently being made.

Other cliff notes:
-It used to be that 25 companies in the world made high end cutting-edge chips. Now, there are only three - and only one in the US - Intel.
-Intel admits that they use TSMC to produce their cutting edge chips, because they cannot make them themselves.

As such, one can easily imagine a situation where China invades Taiwan and takes control of TSMC, forcing the US to defend Taiwan as they did with Kuwait from the Iraqis 30 years ago. it's scary to think how close we are to a total world destabilizing event.

 

[CGiRanger]

Other cliff notes:
-It used to be that 25 companies in the world made high end cutting-edge chips. Now, there are only three - and only one in the US - Intel.
-Intel admits that they use TSMC to produce their cutting edge chips, because they cannot make them themselves.

Damn, so Zorin's plan came to fruition after all

 

[CrankyJay™]

We don’t have the “know how”? We are the fucking US of A! I won’t stand for this shit!

 

[Taxexemption]

We don’t have the “know how”? We are the fucking US of A! I won’t stand for this shit!

Once you lose an industry its gone, and takes massive amounts of money to get back. You have to train a whole new workforce, and spend huge amounts of money to sell products at a loss while you get things up and running. Also, due to electronics in general going to the east there are probably fewer "feeder jobs" (probably not the correct term). Basically if you don't have a bunch of people already doing similar types of work, it will be really expensive to train people to do it, and you will end up having a bunch of costs that other businesses in the industry don't have. You will probably end up paying exorbitant amounts of money to hire away experts from other businesses to get things off the ground.

 

[nush]

We don’t have the “know how”? We are the fucking US of A! I won’t stand for this shit!

It was cheaper to lay people off and outsource.

 

[DeepBreath87]

It was cheaper to lay people off and outsource.

We paid people to train their own replacements.

 

[JayK47]

Well we need to bring industry back to the US. And it will take a lot of time and money to do it. But it will be worth it and it is necessary.

 

[Hatemachine]

We don’t have the “know how”? We are the fucking US of A! I won’t stand for this shit!

We definitely have the know how, the problem we can't compete with China on the basis of cost.

 

[Reality Czar]

As such, one can easily imagine a situation where China invades Taiwan and takes control of TSMC, forcing the US to defend Taiwan as they did with Kuwait from the Iraqis 30 years ago. it's scary to think how close we are to a total world destabilizing event.

So I guess political threads are ok?

 

[Burnttips]

Chip manufacturing is done by machinery. People would be needed to upkeep and repair. Companies have good deals going and don't care about short term shortages.

 

[Hatemachine]

nvm

 

[dr_octagon]

I remember reading an article mentioning chips and the risk around supply shortages, lack of expertise, dependency on other countries

manufacturing should stay within the home country but all about saving monies and everything is outsourced

 

[Schattenjäger]

Damn, so Zorin's plan came to fruition after all

 

[sackings]

anyone paying attention at all to the chip sector already knew this, but yeah, its a big problem. TSMC invest billions upon billions into their R&D for every 1-2 nm making chips smaller. Each shrink isnt even profitable for 5+ years after they've started using it. So yeah, its a massive investment even when you are top dog like TSMC, never mind when you are behind. Shit aint easy at all, its why intel has lagged behind for the last decade. TSMC is just straight up better and smarter than they are at it.

 

[DeepBreath87]

anyone paying attention at all to the chip sector already knew this, but yeah, its a big problem. TSMC invest billions upon billions into their R&D for every 1-2 nm making chips smaller. Each shrink isnt even profitable for 5+ years after they've started using it. So yeah, its a massive investment even when you are top dog like TSMC, never mind when you are behind. Shit aint easy at all, its why intel has lagged behind for the last decade. TSMC is just straight up better and smarter than they are at it.

The US is about to flush $2 trillion down the toilet. Maybe we could invest a few billion into this.

 

[AJUMP23]

As such, one can easily imagine a situation where China invades Taiwan and takes control of TSMC, forcing the US to defend Taiwan as they did with Kuwait from the Iraqis 30 years ago. it's scary to think how close we are to a total world destabilizing event.

Just so you know, we have had a treaty with Taiwan to defend them in the case of any invasion. It is within our strategic interest to maintain good relations with Taiwan for military and defense. Before TSMC thing ever came to light we have had treaties that talk about the US being a line of defense. China knows this and so they may say Taiwan is their territory they are not bold enough to act on it yet.

China knows they need US dollars and trade to keep their economy afloat. They need the western dollar more than the west needs their cheap labor. You can already see this by the rate at which many companies have begun to open production facilities in Korea and other highly skilled eastern countries. India would benefit the most in tech jobs if China were to act.

Also Leslie Stahl calling a plant a “fab” is ridiculous like a parent trying to be cool at teenage party.

 

[AJUMP23]

Strategically the US needs to make their own microprocessors for defense equipment. We also need weapons that do not rely on GPS. You knock out GPS you knock out most attack and coordination capabilities between US forces.

 

[DoomGyver]

I ordered a new vehicle and won’t see it until September if I’m fortunate, could be as late as December. All because of a semiconductor shortage. There are certain items a country should always manufacture for themselves for security reasons alone. Food, medicine for example. In this technological world we live in where everything is electronic? We should be manufacturing more.

 

[West Texas CEO]

By most estimates, demand is only about 30% ahead of current supply, so the world only needs maybe one TSMC worth of extra capacity and it will get a good chunk of it in 2023 from the three usual suspects' new fabs and upgrades at 50-150k WSPM a pop.

China also has a bunch of 'planned' fabs with an aggregate capacity around 1M WSPM which would take a pretty good bite out of outside suppliers' load if successful.

And then you also have the fact that a 12-16nm chips shrunk to 6-8nm will produce 2-4X as many usable chips per wafer depending on how well the circuitry scales with process and the bits that don't scale well at all or need to be extra-rugged can be spun off on a separate die if necessary.

 

[Mistershine.]

I thought this was about the actually important spud based snack business, not some lame computer hardware stuff.

 

[Max_Po]

American greed... pocket the most profit without a solid backbone.

Same as pharmaceuticals..manufacture your stuff in your country instead of contracting to cheapest producer....

 

[Rentahamster]

Yay capitalism.

Profit is good, but should not take a backseat to national security.

 

[West Texas CEO]

I thought this was about the actually important spud based snack business

 

[HoodWinked]

Tsmc and Samsung are building facilities in Arizona and Texas. The supply is going to meet demand. Almost think they may overshoot because the panic now.

It's tough if they subsidize it they become reliant on it and then the subsidies go on forever.

There has to be better methods to keep things domestic. Tarrifs are seen as the devil but it might be the best method. You lose some economic benefits but that loss can basically be seen as the cost to keep domestic production.

 

[West Texas CEO]

Tsmc and Samsung are building facilities in Arizona and Texas.

Is there an eta?

 

[Smiles and Cries]

really good report

 

[12Goblins]

Chipmaker TSMC eyeing expansion of planned Arizona plant -sources

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) (2330.TW), is planning to build several more chipmaking factories in the U.S. state of Arizona beyond the one currently planned, three people familiar with the matter told Reuters.

www.reuters.com