Trump has been touting TSMC’s $100 billion plan to build new factories in the US as a strategic win. But former Intel CEO Pat Gelsinger suggests the investment is merely a facade that masks the US’ ongoing chip-making shortfalls.
Taiwanese chip giant TSMC says it will invest $165 billion to construct six new fabs in the US; the first factory is already online in Arizona. The company promises to create thousands of jobs and make the US a major site for cutting-edge chip manufacturing in the coming years.
Gelsinger, however, points out that the heart of TSMC’s chip prowess—its R&D—will remain in Taiwan. “If you don’t have R&D in the US, you will not have semiconductor leadership in the US,” Gelsinger told The Financial Times. “All of the R&D work of TSMC is in Taiwan, and they haven’t made any announcements to move that.”
In other words, TSMC is merely establishing overseas factories, not uprooting the real talent behind the chip design processes and migrating it to the US. Of course, Gelsinger’s comments are self-serving. Before exiting as Intel’s CEO in December, he made a huge bet on the company expanding into the foundry business and directly competing against TSMC.
Gelsinger’s goal was to help restore US chip leadership when most semiconductors are made in Asia. But it remains unclear if his bet will pay off. Intel has been banking on customers placing orders for its 18A manufacturing process, which is slated to start producing chips later this year. But last month, the company decided to postpone its new factory in Ohio again, suggesting client demand has yet to materialize.
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TSMC probably won’t agree with Gelsinger’s take. The company’s $100 billion investment does include establishing a new R&D center in the US. Still, the Taiwanese government itself is also concerned that TSMC is moving too much production away from the island, giving less incentive for the US to protect Taiwan in the event of a Chinese military invasion.
“If TSMC turns into ‘American Semiconductor Manufacturing Company,’ where will Taiwan’s security be then?” one Taiwanese lawmaker told the press.
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About Michael Kan
Senior Reporter
