21 September 2021

The Verge: “Why the global chip shortage is making it so hard to buy a PS5”

I had somebody from deep within Washington call me up and ask me how much money it would take to catch up with TSMC. I had just been to the GlobalFoundries fab in Malta, New York, and they had spent $15 billion to get 30,000 wafer starts per month at 14 nanometers — so it’s not even leading edge, but it’s a nice fab. They’ve done a good job there. TSMC Fab 12 has a capacity of 250,000 wafer starts per month. TSMC Fab 14 has about 250,000. TSMC Fab 15 has about 250,000. TSMC Fab 18, they’re targeting the same capacity. So I told this person, Oh, I don’t know. You’d probably have to spend 10 times what GlobalFoundries spent up in Malta, New York. I could hear him fall out of his chair.

And when he got back up, he said, What did you say? And I said, I don’t know, 10 times that, $150 billion. Maybe it’s not $150 billion. Maybe it’s $130 or $140 billion. But you have to realize that TSMC is going to spend over $30 billion this year, and that’s one company. And they spent $20-plus billion last year, and they’ve been spending $10 to $20 billion a year for the last decade. And they’d been spending like $5 to $10 billion a year for the decade before that. So they’ve been pouring money into this for 35 years. So $52 billion — and by the way, all the lobbyists are in there trying to make sure that their company gets their share of it. By the time it gets peanut-buttered around, the worry will be, how much difference is it actually going to make?

Dr. Willy Shih

Nice overview of the complexities of chip manufacturing and how the supply was affected by the pandemic. It helps to remember the numerous steps and precision required to produce chips, and why efforts to create domestic production from US companies and the European Union will take a long time and huge investments to materialize.

Everything you need to know about the global chip shortage

No, it’s not that sophisticated. That’s one of the reasons I try to educate as many people as I can about how complex this is. So for example, the Biden administration produced that 100-day report on critical supply chains. And they sent it to me the morning it came out and I read the whole thing, which was a long report. It was 220-some pages, I read the whole thing. And my response to that was okay, after you’re done with those four supply chains, I’ll give you another four where we’re dependent on various parts of the world for all those different pieces. And when we’re done with those four, I’ll give you another four. And when you’re done with those four, I’ll give you another four. And how long would you like to play this game?

I do think it’s important for us to be able to manufacture the most advanced semiconductor technology in the US, because as I said, that’s important for innovation, but if you think you’re going to be an island, not dependent on the rest of the world for anything else, then all you’re doing is echoing Xi Jinping’s dual circulation strategy, which is I want the world to be dependent on me, but I don’t want to be dependent on anybody else. I don’t think it’s going to happen.

Dr. Willy Shih

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