TSMC has just finished securing government grants, to build a $ 12 billion factory in Arizona, USA. TSMC is complying with the requirements of the US Government, transferring high-tech production lines to this country.
TSMC President Mark Liu said: “The federal and state governments of Arizona have agreed to help offset the higher costs of producing semiconductors in the US”. The decision to build the plant in the United States was made by TSMC, after President Donald Trump raised concerns about national security as many American technologies were used to produce abroad.
TSMC sided with the United States, leaving Huawei alone.
The administration of President Donald Trump wants production lines using American technology to be located in the United States. That’s why TSMC has to build a new semiconductor factory in the US.
This decision by TSMC was also made at a time when the US restricted selling chips to Huawei. The Chinese telecommunications giant is one of TSMC’s biggest customers. However, because TSMC’s chip production lines are based on American machines, software and technology. So the Taiwan-based manufacturer still has to listen to the orders of President Donald Trump.
“Without orders from HiSilicon, our other customers will want to fill that gap,” President Mark Liu said.
President Mark Liu of TSMC.
Liu’s statement confirmed that TSMC regretted losing a huge contract with Huawei. That gap will be filled by other customers, so TSMC’s business will not be affected too much. Perhaps Huawei will also be disappointed to hear this statement from President Liu.
That means TSMC may not be looking to lure Huawei, leaving the Chinese telecommunications giant no longer even a glimmer of hope. The partnership ended, meaning Huawei could not produce its own chips and would seriously affect all core businesses.
As the world’s largest and most advanced semiconductor manufacturer, TSMC plays a vital role in the production of smartphones, laptops, AI systems and the Internet of Things. Huawei is TSMC’s largest customer after Apple, accounting for about 14% of the total revenue of the Taiwanese chip maker.
Huawei is desperate to salvage its partnership with TSMC.
For TSMC, it is increasingly difficult to maintain a neutral stance, amid tensions between the US and China. TSMC could not choose to side with Huawei, because it relied entirely on American machines, supplied by companies like Applied Materials and Lam Research Corp.
President Liu ended with a knife-like stab into Huawei’s heart: “Huawei will not be able to produce smartphones in the future without a chip, and other smartphone companies will take Huawei’s market share. We will still have a large market share thanks to other customers, after the market adjustment and balance ”.