Posted on 04/03/2021 8:23:28 PM PDT by anthropocene_x
America’s manufacturing sector has been struggling of late, and has lost more than 500,000 jobs since the start of the COVID-19 pandemic. Compounding these woes is a recent, global shortage of semiconductor chips. A heavy reliance on computer chips from Taiwan and Korea has hit U.S. manufacturers hard. The nation’s auto sector has been particularly affected, with Ford F, -0.65% forced to cut back production of its F-150 truck and GM GM, +0.59% halting operations at three plants. All of this points to the wider problem of America’s rising import dependence. Reliance on overseas semiconductor producers has put the United States in an especially precarious position. Computer chips are a key part of cellphones, laptop computers, automobiles, and medical devices. But they’re also the brains of America’s military arsenal, including the F-35 fighter and other advanced weapons systems. With both economic and national security at stake, the United States must rebuild its domestic chip-making capabilities. Unfortunately, that won’t happen if America’s chip industry keeps focusing on quarterly profits rather than long-term stability. Consider Intel INTC, +0.86%, for example. The California-based chip maker operates 15 foundries (“fabs”) world-wide, including four in the United States. Last year, Intel invested $14.5 billion on capital spending. However, it also returned $19.8 billion to shareholders, including $14.2 billion in buybacks of its own stock. Essentially, Intel chose to return more money to shareholders than to invest in operations. This is poor long-term thinking, especially when Intel’s business is already under threat. Recently, Apple AAPL, +0.70% decided to replace the Intel processors in its MacBooks with chips sourced from Taiwan’s TSMC. Noting that Microsoft MSFT, +2.79% and Amazon AMZN, +2.16% are also shifting to chips sourced from TSMC TSM, +5.51%, it’s clear that U.S. dependence on imported semiconductors will only increase in the coming years.
(Excerpt) Read more at marketwatch.com ...
If China goes after Taiwan it will take out TSMC. Then there will be a chip shortage beyond anything imaginable.
re: “Then there will be a chip shortage beyond anything imaginable.”
Don’t worry. Abu Dhabi has big investments in store for some existing plants here in the US even ...
That, and China may be dependent on chips from TMSC too.
Global Foundries, who has Abu Dhabi investment, has plants in the US, but their process technology is FAR behind TSMC.
GF is stuck at 12nm. TSMC is doing production at 5 nm.
Prior to the unconstitutional income tax, weren’t tariffs the source of money for the US government?
The barrier is government in the form of taxes & the EPA.
It Wall Street.
re: “but their process technology is FAR behind TSMC.”
What’s your point?
The shortages are in IC designs that don’t require the high-tech fine geometries required for high density designs like TSMC or Intel are capable of ...
TSMC is building a huge new semiconductor plant in the Phoenix area, but whether they can get it up and running before China strikes at Taiwan is an open question.
Intel’s troubles, which they seem to have been having for 25 years, are the competition is better and cheaper. Neither of those are a reason for the government to declare Intel necessary and start controlling them.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.