Intel, TSMC may build chip factories in United States

The Donald Trump administration is in talks with semiconductor companies Intel and Taiwan Semiconductor Manufacturing Co (TSMC) about building chip factories in the United States, Reuters reported.
Semiconductor revenueUS-based Intel is in talks with the United States Department of Defense over improving domestic sources for microelectronics and related technology, Intel spokesman William Moss said in an emailed statement.

“Intel is well positioned to work with the U.S. government to operate a U.S.-owned commercial foundry and supply a broad range of secure microelectronics,” the statement added.

Taiwan Semiconductor Manufacturing Co is in talks with the U.S. Department of Commerce about building a U.S. factory but said it has not made a final decision yet.

“We are actively evaluating all the suitable locations, including in the U.S., but there is no concrete plan yet,” TSMC spokeswoman Nina Kao said in a statement.

Intel CEO Bob Swan wrote a letter to the Department of Defense in March expressing the company’s willingness to build a foundry – a term used in the industry to reference a chip factory – in partnership with the Pentagon.

“This is more important than ever, given the uncertainty created by the current geopolitical environment,” Bob Swan wrote in the letter dated March 30.

“We currently think it is in the best interest of the United States and of Intel to explore how Intel could operate a commercial U.S. foundry to supply a broad range of microelectronics,” Intel CEO said in the letter.

Wall Street Journal reported that TSMC has been talking with iPhone maker Apple, one of its largest customers, about building a chip factory in the United States. TSMC declined to comment on the talks with the iPhone maker.

The WSJ report indicated that U.S. officials are looking at helping South Korea’s Samsung Electronics, which has a chip factory in Austin, Texas, to expand its contract-manufacturing operations in the United States.

Analyst firm Gartner said global semiconductor revenue will dip by 0.9 percent to $415.4 billion in 2020 with non-memory expected to decline 6.1 percent, while memory is forecast to grow 13.9 percent. The significant drop in revenue is due to the impact of the coronavirus on semiconductor supply and demand.