Source: Global Times [Global Times reporter Zhao Juezhang Pan Xiaotong Global Times special correspondent Chen Lifei] TSMC is being moved to the United States little by little! Faced with the recent acceleration of TSMC's production capacity and talents in the United States, some

Source: Global Times

[Global Times reporter Zhao Juezhang Pan Xiaotong Global Times special correspondent Chen Lifei] TSMC is being moved to the United States little by little! Faced with the recent acceleration of TSMC's production capacity and talented people's trip to the United States, some Taiwanese media and industry insiders have recently issued a cry. It is reported that TSMC's fab in Arizona, USA will hold a moving ceremony on December 6, and White House said that Biden will attend the ceremony on the same day. TSMC founder Zhang Zhongmou recently confirmed that TSMC's cutting-edge process capacity will also be put into production at its US factories in the future. Some media believe that the United States' "blood-sucking" chip industry chain may eventually turn TSMC into "USG". Experts analyzed that TSMC's investment in the United States does not mean that the United States can establish a chip industry chain pattern that is "the United States dominates" as it wishes.

semiconductor industry "chronic blood loss"

Bloomberg reported on December 1 that TSMC, the world's largest wafer foundry, spent $12 billion to build a new factory in , Arizona, will produce 4nm chips when it is opened in 2024, instead of the previously planned 5nm chips. This is because TSMC's customers, especially many American companies, require TSMC to "simultaneously" launch its latest technology in the United States. TSMC is expected to announce the new plan at the ceremony on the 6th. According to reports, TSMC's Arizona plant has undergone upgrade plans to provide more advanced chips. Earlier, the company announced that the Arizona plant would produce 20,000 wafers per month, and the actual output could be higher.

It is reported that in early November, TSMC first chartered nearly 300 employees to the United States, and then it will be divided into 6 chartered flights to deliver a total of more than a thousand engineers and their families to the United States one after another. It is reported that in terms of benefits and subsidies, TSMC's engineers in the United States have doubled their basic salary, and dividends and are still distributed in accordance with Taiwan's regional distribution, and they also enjoy certain subsidies in terms of residence.

According to Taiwanese media reports, such conditions seem tempting, but some TSMC employees revealed that the real situation is not that good. In terms of vacation, the island has transferred employees to only provide 14 days of rest buffer, while American employees can rest for 21 days before going to work. TSMC originally promised to not have to take shifts after being transferred to the United States, but after the arrival, it changed its mind and said that American employees do not want to take shifts, so they could only make up for the vacancies of employees on the island, and even the management has to be on a big night shift. In terms of salary, the island's employees are much worse than Americans, making them look like "secondary slave labor".

In response to the dispatch of engineers to the United States, TSMC responded on November 28 that the number of people sent out is relatively limited compared to the number of employees on the island, and there is no doubt of "emptying semiconductor talents on the island." Taiwan's "Economic Minister" Wang Meihua said on December 1 that TSMC has 50,000 engineers, and about 500 people traveling to the United States account for a very low proportion, which is a normal talent exchange. She also said that Taiwan’s chips are doing global business, and production volume accounts for only less than 10% in the United States or Japan, so the impact is not great.

However, public opinion on the island is not so optimistic. Senior media person Chen Fengxin said on November 28 that TSMC sent Taiwan’s top talents to the United States, and behind the consideration is that the production cost in the United States will be very high, and there are not many talents in the United States Science and Technology , and there are very limited people who are willing to invest in semiconductor . Secondly, American engineers are not willing to take shifts, but fabs must operate 24 hours a day, which is unacceptable for Americans. She warned that Taiwan’s chip talents are being “emptyed”, and as TSMC’s first batch of talents go to the United States, there will be “chronic blood loss” in the future. Media person "engineers look at politics" bluntly stated that TSMC's advanced process technology and thousands of engineers were taken to the United States, and first-class talents in the semiconductor industry on the island were stolen. How can we compete with Samsung , Qualcomm , Huawei ?

"TSMC and 'MCC'", a comment from the China Times on this topic stated that the recent Buffett and Soros bought TSMC because TSMC's technical capabilities are world-leading. However, the article specifically cited the "learning of the past" of Japanese semiconductors, saying that Japan once had the advantage of semiconductors, but was later "stopped" by the United States.TSMC originally wanted to invest heavily in setting up factories in mainland China, but the United States did not allow it. Now the United States not only wants to pull TSMC away, but also takes away the semiconductor engineers and upstream and downstream industrial chains in Taiwan. "The US manufacturing industry has become hollowed out, and in the end, it forces Taiwanese companies to give technology, talents, and money, and turn TSMC into 'American Securities'." But no one on the island dares to say "no" to the United States.

The prospect of going to the United States is difficult to assert.

Deputy Director of the American Research Center of Fudan University and Director of the Taiwan Research Center Xin Qiang said in an interview with a reporter from " Global Times " that TSMC's investment in the United States has a certain promoting effect on the development of the US chip industry, but this does not mean that the United States will be able to establish a chip industry chain pattern that is "the United States dominates" as it wishes. Xinqiang believes that due to a series of factors such as the continuation of US policies and the game of interest among political parties, it is difficult to assert that TSMC's future development prospects are good or bad for the US domestic chip industry.

University of Arizona Bao Jialin wrote an article on November 30, specifically mentioning the risk of "desert factory building". The article said that the Arizona area has a large number of deserts, and the maintenance of water resources mainly depends on limited groundwater, followed by artificial channels to attract the Colorado river water for use by millions of residents. After the channel was opened in 1993, it was found that the river water still had a bad water quality after treatment and could not guarantee a large amount of supply. Due to the drought climate in the desert, the river water flowed in the channel for a long time and continued to evaporate along the way, and a lot of chemicals such as calcium were deposited.

The semiconductor industry has always been a "big water-consuming player". According to TSMC, in 2019, the company's factory in Hsinchu consumed 63,000 tons of water every day, accounting for more than 10% of the water storage capacity of the two local reservoirs - Baoshan Reservoir and Baoshan Second Reservoir. The BBC said that when drought weather has occurred in recent years, the Taiwan authorities have sacrificed farmers' water to ensure the demand of semiconductor industries such as TSMC.

Bao Jialin said that TSMC's water use may affect the water supply of residents south of Phoenix, Arizona in the future. If there are real problems in 5 or 10 years, there will be "unexpected consequences." Residents of the upstream four states that already have litigation experience, even Arizona and and California may launch class action lawsuits. Bao Jialin said that at that time, the litigation targets of residents will most likely not be the US government, but TSMC. "By then, the sweet talk Biden and Raymondo may no longer be in their position. Will TSMC bear the legal liability itself?"

The US "coercion and inducement" is difficult to achieve its wish

"The United States is vigorously promoting the development of the semiconductor industry." According to a report by South Korea's "Daily Economy" on November 29, the US Congress passed the Chip and Science Act in July this year. The bill includes the United States' comprehensive national technology strategy for technological leadership and China, and decides to inject tens of billions of dollars into the semiconductor industry in the next five years. Xinqiang said that the investment in building factories in the United States by many Asian chip companies, including TSMC, Samsung, SK, etc. is to use state subsidies to force companies to go to the United States to carry out production in order to maximize the localization of the semiconductor industry chain.

Xinmou Research Chief analyst Gu Wenjun told the Global Times reporter that under the "coercion and temptation" of the United States, other Asian semiconductor companies such as Samsung are also increasing their investment in the United States. Gu Wenjun believes that there is indeed a trend of "semiconductor manufacturing migrating to the United States". Specifically, the United States not only issued the Chip and Science Act to support leading international semiconductor manufacturing companies to build factories in the United States, but also formed a "Chip Quad Alliance".

"The United States is actually very clear that Asian companies such as TSMC and Samsung are the biggest competitors in the US semiconductor industry, and it is difficult to compete with the two by relying solely on local American companies." Gu Wenjun believes that the United States forces companies to build factories in the United States, but at present, the US chip industry also faces several contradictions. Among them, the most prominent contradiction is the contradiction between the industrial policies proposed by the United States and the highly market-oriented semiconductors themselves, which is difficult to resolve.In addition, the current behavior of the United States to enhance its own semiconductor capabilities through various means can easily damage the interests of other countries, trigger conflicts with regional allies, and at the same time cause overcapacity in the industry.

Information Consumption Alliance Chairman Xiang Ligang analyzed to the Global Times reporter that the healthy development of semiconductor companies is inseparable from a series of conditions and support, such as government support, appropriate market, upstream and downstream industrial chain cooperation, as well as talents and relatively low operating costs. "The United States cannot guarantee these aspects. So after these companies arrive in the United States, their operating costs will become higher and higher, and they will lose competitiveness in the market. In fact, the subsequent technological updates of companies such as Intel have slowed down." Xiang Ligang analyzed.

Xinqiang said that now, the chip industry has become an important industry related to national security, so we must strive to ensure the autonomy and security of core technologies and key links. On the premise of mature use of existing technologies for production, we will continuously improve the technology and manufacturing level, including striving to innovate and develop new generation technologies and products, and avoid making chips a "bottleneck" technology that restricts national development and security.