TSMC and pals dream of €10B German chip fab A collaboration between TSMC, NXP Semiconductor, Bosch, and Infineon would see the construction of a new fab in Saxony, Germany valued at as much as $11 billion (€10 billion). Citing people familiar with the matter, Bloomberg reports the Taiwanese foundry giant is in talks with partners and German government over the deal. …
So far, I think the tally of subsidies promised by Germany to have tech companies build factories in the country come to something like the UK's entire annual pre-Brexit EU budget.
I was under the impression that EU subsidy rules meant that individual countries couldn't pick and choose which location incoming companies were to build, but this shopping spree by Germany seems to be accepted. From an economic point of view, it's madness, but the new cold war with China is forcing the West to make some very expensive choices.
I'm not convinced this 'top down' form of investment in the tech foodchain is actually a good idea regardless, but we're not going to find out for nearly a decade and a lot will no doubt change by then whatever we do.
Countries within the EU always could provide grands and incentives to attract investment, but there are fairly rigorous rules covering it. Some countries apply them to differing degrees of course...
Top-down gov investment is not always a good strategy, and the UK has had woeful nationalised industries in the past, but equally letting the "free market" decide also is a bad idea, especially if the freedom allows them to follow the cheapest offer from a despotic regime with a long-game to use it for its own interests.
@Andy 73
"I was under the impression that EU subsidy rules meant that individual countries couldn't pick and choose which location incoming companies were to build,"
Oh dear, oh dear, do you seriously belive the EU Commission is who choose which location incoming companies were to build in.
How deeply brainwashed so many Brits still are regarding the EU.
I think I can recommend to you, Fintan O'Toole, in "The Politics of Pain"
https://www.youtube.com/watch?v=hA08SXJ8mAY
The simple fact is that the biggest customers for chips in Europe are Germany and France and especially Germany has been ready to invest in that industry and those chip companies are also keen to invest in the right country.
No, I believe there are strict laws about how EU subsidies can be used to favour individual countries. They were brought up regularly with regards to the location of car factories in the UK and Airbus in Ireland.
Perhaps you should put that straw man down...
If these are EU subsidies being spent, the line "Germany has been ready to invest" is at best disingenuous. Up until very recently, Germany, like any sane Western country was very happy to buy chips from the factory that could make them cheapest, regardless of location. You insult us by suggesting that it is British nationalism at issue here.
"So are we asserting that had the UK remained within the European Union, TSMC would have had a very real possibility of building a sub 100nm chip plant within the UK?"
This is just an excuse for them to moan about brexit. Possibly click bait or just sore loser. I dont see how the UK would benefit when as it says in the article-
Initially planned at €7 billion, the costs are expected to balloon to €10 billion and the consortium expects Germany to cough up a solid chunk of that.
Why would we want to blow a load of money to produce chips at a higher price than elsewhere. Especially when the US and EU will throw money at them for us.
@LogicGate
"See.. fixed it for you."
Not really. You mention the Asia part without noticing the redundancy being put in place by the EU and US planning to produce the same products. And the extra expense being covered by their tax payers while we get competitively priced chips and the extra sources should things go wrong in a part of the world.
@localzuk
"The thing with strategic industries, you need some at home. Because your allies are not always your allies."
The UK cannot provide enough food for its citizens. In such bad times that we are no longer friends with either the US nor EU we are in bigger trouble than some chips
I'm not sure if you know your history, but during WW2, one of the biggest issues the UK faced was the difficulty importing things from its allies. Europe was at war, so couldn't import from there, and the stuff we imported from the US often ended up at the bottom of the Atlantic due to Uboats... So, all in all, we do need to improve our national strategic resilience.
You think we only need chips for cars? Without our supply of semiconductors from ally countries half way round the world, we don't have working tanks, drones, jets, missiles, ships, anti-air systems, refineries etc... Hell, even our tractors need them to provide us with food.
That's why it is a strategically important asset. As Russia has found out.
@localzuk
"You think we only need chips for cars? Without our supply of semiconductors from ally countries half way round the world, we don't have working tanks, drones, jets, missiles, ships, anti-air systems, refineries etc... Hell, even our tractors need them to provide us with food."
Which is why you might need to answer the second part of the question of how we would get the materials and maintenance to keep producing if the situation was so bad. If you believe it so important wouldnt buying the cheap chips and stocking them up be better than expensive manufacturing in a country much more expensive to produce them and still have the strategic problem of having to import materials instead of chips.
A ChatGPT Writes ...
The issue of chip manufacturing capacity in the UK is indeed important and complex. Let's address your points one by one:
Materials and Maintenance: The semiconductor industry heavily relies on a global supply chain for materials and equipment. If the UK's chip manufacturing capacity is limited, it would still need to acquire materials and maintenance services from international suppliers. The challenge arises when there is a disruption in the supply chain, such as trade restrictions, global shortages, or geopolitical tensions. In such situations, relying on imports may become more challenging, potentially leading to supply chain vulnerabilities.
Buying Cheap Chips vs. Expensive Manufacturing: Buying cheap chips from other countries may seem like a short-term solution to address immediate demand. However, it comes with its own set of challenges. Firstly, the availability and reliability of supply from other countries can vary. Relying solely on imports could leave the UK vulnerable to disruptions in the global supply chain. Secondly, strategic considerations come into play. The domestic chip manufacturing capacity offers long-term benefits, such as control over critical technologies, supply chain resilience, and the ability to tailor production to specific national security or industrial needs.
Cost of Manufacturing: It is true that manufacturing chips in the UK may be relatively more expensive compared to certain other countries. However, the decision to invest in domestic chip manufacturing is not solely based on short-term cost considerations. Strategic factors, technological sovereignty, and economic diversification are often taken into account. Additionally, it is worth noting that the cost dynamics of chip manufacturing are influenced by factors such as economies of scale, research and development capabilities, and the potential for technological advancements. Therefore, while immediate cost differentials may exist, the long-term benefits of domestic manufacturing may outweigh them.
To summarize, the issue of chip manufacturing capacity involves a complex interplay of factors such as supply chain resilience, strategic considerations, and economic dynamics. While importing cheap chips may address short-term demand, investing in domestic manufacturing can provide long-term benefits in terms of supply chain control, technological sovereignty, and economic diversification.
"Production of chips for the automotive sector has previously been floated, but some sources told Bloomberg that the facility will focus on more mature 28-nanometer parts."
This is the same thing, so replace "but" with "and."
There are higher end parts in certain applications in certain cars (extreme autonomy) but usually you get the cheapest most reliable and mature parts you can for your ABS module or what have you.
The question is; what proportion of Automotive microelectronics do you think requires process technologies below 28nm
Are 3nm chips required for the central-locking-system, driving the head lights or controlling the battery charging.
Maybe Silicon Carbide capacity is more critical to Automotive production than 3nm Silicon technology.
The question is; what proportion of Automotive microelectronics do you think requires process technologies below 28nm
Are 3nm chips required for the central-locking-system, driving the head lights or controlling the battery charging.
Maybe Silicon Carbide capacity is more critical to Automotive production than 3nm Silicon technology.
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