Home » Business » Biden Boasted That TSMC Went to US to Set Up a Factory, and Many American Media Poured Cold Water on It: It Was All About “Making Money” | blog posts
Biden Boasted That TSMC Went to US to Set Up a Factory, and Many American Media Poured Cold Water on It: It Was All About “Making Money” | blog posts
On December 6, TSMC held an equipment transfer ceremony at the invested and built semiconductor factory in Phoenix, Arizona, USA. US President Biden attended the ceremony and gave a speech, taking the opportunity to boast about his “economic achievements”.
The ceremony was attended by US President Joe Biden. AP images.
But already during the previous construction of the factory, TSMC founder Zhang Zhongmou has repeatedly “poured cold water” on the localization of American semiconductors, and this time the equipment transfer ceremony was held, and Taiwan’s concerns and anger for “TSMC becoming USMC” Not only did TSMC’s share price plummet, Taiwanese media also pointed out that the United States “strongly tied TSMC” to diversify geopolitical risks.
The “Wall Street Journal” even bluntly stated that TSMC will indeed encounter problems such as high costs, lack of talent and obstacles to building a factory in the United States, which can be described as “many challenges”. Bloomberg also published a commentary article, pessimistic about this project, not only pointing out that the project accounts for a very small share of global chip manufacturing capacity, but also affected by tension in the Taiwan Strait.
In addition to Biden’s presence, nearly 900 people attended the ceremony, including US government officials and Apple CEO Tim Cook, Micron Technology CEO Sanjay Mehrot, and Nvidia CEO Huang Renxun. There were politicians and businessmen present. For TSMC, founder Zhang Zhongmou and chairman Liu Deyin also attended the ceremony.
According to Reuters, ahead of the ceremony, TSMC announced it would more than triple its originally planned investment from $12 billion to $40 billion, while its two plants in Phoenix were expected to invest in 2024 and 2026, respectively. 4nm and 3nm fries. According to reports, this is not only TSMC’s largest investment project outside Taiwan, but also one of the largest foreign direct investment projects in US history.
TSMC’s Arizona plant. images online.
Regarding TSMC’s establishment of a factory in the United States, Taiwan’s “United Daily News” published a commentary on December 7, noting that Biden made a special trip to attend the ceremony and give a speech, and also asked the executives of major suppliers of The above is also binding on the image of the “semiconductor ally” between the United States and TSMC.
The report also directly pointed out that the US move is to “strongly constrain TSMC” in order to disperse geopolitical risks and encourage TSMC to set up factories in the United States on the basis of “resolving US national security issues” .
Taiwanese media “China Times” reported that TSMC’s stock price plummeted on the 6th, coupled with the panic effect caused by TSMC’s relocation, netizens on Taiwan island were devastated when they saw TSMC-related news, shouting “the door is gone, the door has been demolished.” I went to Arizona”, “The whole thing moved, without even leaving the door”. Some netizens said, “Building one more fab in the US means building one less in Taiwan” and “in a few years will call Microchip”.
Screenshot of Taiwanese media’s “China Times” report.
By contrast, the US is quite enthusiastic. According to White House website news, Biden said in a speech at the ceremony that day that the United States accounted for more than 30 percent of the world’s chip production more than 30 years ago, but because of something that happened, the he manufacturing industry, which is the backbone of the US economy, began to be drained and companies moved jobs overseas.
“But everyone, where does it say that the United States can’t go back to leading the world in manufacturing?” Biden then enthused that what TSMC’s Phoenix factory will produce will be the world’s most advanced semiconductor chips, which will be used to power Apple’s iPhone and MacBook, thus “changing the rules of the game.”
At the same time, Brian Deese, director of the White House National Economic Council, said on the 6th that Biden’s visit to the ceremony in person symbolized that TSMC had achieved an important milestone: bringing the most advanced semiconductor manufacturing back to the United States. The New York Times said the same day that “the factory is of great importance and will help the United States ‘build a front against China'”.
Taiwan media reported that TSMC founder Zhang Zhongmou also gave a speech at the equipment moving ceremony that day. on the other hand, he warned that under the influence of current geopolitics, globalization and free trade are “almost dead” and unlikely to return.
It is worth mentioning that during the construction of TSMC’s factory in the United States, Zhang Zhongmou once believed that “the United States will fail to promote local semiconductor production” and that “the United States’ efforts to increase production capacity of semiconductors are unnecessary, wasteful and expensive.” The United States has been accused of tracking down the semiconductor industry chain.
Zhang Zhongmou, founder of TSMC. AP images.
Compared to the enthusiasm of the White House and some American media, the “Wall Street Journal” analyzed the many challenges faced by TSMC in setting up factories in the United States in its December 5 report.
The report stressed that although the White House believes the factory represents “America’s expectations for the revival of manufacturing,” TSMC said it will not be easy to complete the project, which will encounter high costs, a lack of talent and unexpected construction hurdles. and other problems.
According to reports, TSMC said in a letter to the US Department of Commerce last month that the Phoenix factory faces a variety of construction costs and project uncertainties. In contrast, the construction of an advanced factory of the same level in Taiwan it is capital intensive. much lower than that of the United States. TSMC said the real obstacle to setting up a production line in the United States is the comparative cost of building and operating.
Accompanied by TSMC executives, Biden visited the TSMC power plant construction site. AP images.
Bloomberg reported on the 6th that TSMC could receive billions of dollars in subsidies from the “Chip and Science Act,” a bill signed by Biden in August this year, which provides $53 billion in incentives for companies that produce semiconductors in the United States. However, some media believe that it is not yet known whether the bill can actually be implemented and may just be “painting a big cake”.
There are signs that past bipartisan cooperation on economic issues may be more difficult to reproduce after Republicans win a majority in the House of Representatives in the November midterm elections.
Another Bloomberg commentary article, titled “Sorry, America, $40B Can’t Buy Chip Independence,” cast a negative light on TSMC’s move to the United States to set up a factory. The article not only believes that the so-called “game changer” in Biden’s mouth is just empty talk, but also noted Zhang Zhongmou’s earlier remarks of “throwing cold water” on the United States.
Screenshot of a Bloomberg comment.
The article also pointed out that TSMC’s creation of factories in the United States represents a very small share of global chip production capacity and also exposes the United States to tensions in the Taiwan Strait. Thousands of jobs and billions dollars in infrastructure in Arizona will also be threatened.
“TSMC’s $40 billion may actually be the largest foreign direct investment (in the US), but it’s still not enough to ensure the US builds a self-sustaining semiconductor industry. It’s only being used to buy” bragging rights.” The article concludes with such trenchant writing.
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