White House reportedly in talks with Intel, TSMC to build advanced chip foundries in the U.S.

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White House officials are talking to Intel and TSMC about building semiconductor foundries in the United States, according to a Wall Street Journal report. U.S. tech companies and the government have been trying to reduce the country’s dependence on chip factories in Asia for years, underscored by national security concerns, the U.S.-China tariff war and now the COVID-19 pandemic, which has disrupted supply chains and logistics around the world.

The WSJ also reported that some U.S. officials have also talked to Samsung Electronics about expanding its existing contract-manufacturing operations in the U.S. to produce more advanced chips.

Intel, TSMC and Samsung Electronics are able to make chips of 10-nanometers or lower, the fastest and most power-efficient chips currently on the market.

In an April 28 letter obtained by the WSJ, Intel CEO Bob Swan told Defense Department that the company is willing to build a commercial foundry in partnership with the Pentagon “given the uncertainty created by the current geopolitical situation.”

Intel already has U.S. operations that make chips for its own products, but the new factory would serve other companies as well. TSMC, a Taiwanese semiconductor contract manufacturer, would continue making chips for other companies (its customers include Qualcomm, Nvidia and Advanced Micro Devices).

The newspaper reports that TSMC has been in talks with Commerce and Defense department officials and Apple, one of the biggest clients, about building a semiconductor factory in the U.S.

In a statement to TechCrunch, a TSMC spokesperson said “TSMC has always been open to building fabs overseas, and do not rule anything out. We are actively evaluating all the suitable locations, including in the U.S., but there is no concrete plan yet. It all depends on customers’ needs.”

Other solutions that have been proposed by U.S. officials and industry groups include government investment in the domestic chip industry to support the high cost of building foundries, tax credits for semiconductor makers to buy and install equipment at U.S factories, and implementing more export restrictions for U.S. companies that ship microchips to buyers in China.

Source: TechCrunch

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