Apple looks to move away from China for its new products, says Kuo

AppleInsider · April 21, 2022 4:41PM

Analyst Ming-Chi Kuo says that Apple's previous desire to reduce its reliance on China has become "an action plan" since the country's recent lockdowns.

Plans to move away from over-reliance on China have been affected by COVID

The coronavirus was one of the first prompts for Apple, and other technology firms, to reassess their reliance on any one country as a source. However, the coronavirus was then also a reason why plans to make major moves were delayed, and the result was that Apple continued to be reliant on China.

Now analyst Ming-Chi Kuo says that the recent COVID lockdowns in the country have made Apple step up its thinking about diversifying production.

(1/3)
Apple's new product introduction (NPI) sites are almost in China. It was the first time for Apple to evaluate building NPI sites in non-China seriously when the COVID-19 outbreak first occurred about two years ago, but internally it only proceeded to the proposal stage.
-- (Ming-Chi Kuo) (@mingchikuo)
April 21, 2022

"However, after the recent lockdowns in China," continues Kuo in his tweets, "to diversify supply chain management risks, building NPI sites in non-China is no longer a proposal but an action plan."

"New Product Introduction" sites does not necessarily mean completely new categories of device, although Tim Cook is said to hope to introduce one such brand-new venture before he retires.

Previously, Kuo has used NPI when reporting on expectations for the forthcoming Apple Watch Series 8.

Kuo has no further details, and it's also not clear whether this tweet is based on information from the supply chain, or is more supposition like most of his tweets since becoming active on Twitter in March, 2022.

Read on AppleInsider

JWSC · April 21, 2022 5:05PM

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

rob53 · April 21, 2022 5:58PM

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

tmay · April 21, 2022 6:21PM

rob53 said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

Oh for fucks sake.

The U.S. is globally dominant in a substantial number of industries, so your statement is complete bullshit.

This coming from a guy with a degree in Mechanical Engineering that makes shit every day, so yeah, using my hands and brain in combination.

williamh · April 21, 2022 7:44PM

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I don't think the OP is referring to combating COVID when they wrote of human rights. Perhaps they were referring to the slavery and the genocide - the care for the Uyghurs. There will surely be other supply chain disruptions such as when China decides to conduct a "special operation" in the "renegade province."

waveparticle · April 21, 2022 7:57PM

williamh said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I don't think the OP is referring to combating COVID when they wrote of human rights. Perhaps they were referring to the slavery and the genocide - the care for the Uyghurs. There will surely be other supply chain disruptions such as when China decides to conduct a "special operation" in the "renegade province."

This is Bloomberg news. LOL

https://www.bloomberg.com/news/articles/2022-04-20/china-to-sign-forced-labor-treaties-as-xinjiang-scrutiny-grows?utm_source=google&utm_medium=bd&cmpId=google

CurtisHight · April 21, 2022 8:50PM

AppleZulu said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I think you misunderstand Western culture.

Tracking and judging culture and history can be sticky business. I trust that I could find many Chinese with deep respect for the value of each human life, even if not themselves Christian as the ones I know best are. With that being said, I note that British Historian Tom Holland’s Dominion: The Making of the Western Mind (U.S. subtitle How the Christian Revolution Remade the World) gives support to Waveparticle. Here from The Guardian review:

“Holland is surely right to argue that when we condemn the moral obscenities committed in the name of Christ, it is hard to do so without implicitly invoking his own teaching.”

Terry Eagleton, “Dominion by Tom Holland review – the legacy of Christianity,” Guardian, November 21, 2019, (https://www.theguardian.com/books/2019/nov/21/dominion-making-western-mind-tom-holland-review).

—

I read the book two years ago. Here are two selections from the preface:

“Just as the Bishop of Oxford refused to consider that he might be descended from an ape, so now are many in the West reluctant to contemplate that their values, and even their very lack of belief, might be traceable back to Christian origins. I assert this with a measure of confidence because, until quite recently, I shared in this reluctance.”

He goes on to write:

“The more years I spent immersed in the study of classical antiquity, so the more alien I increasingly found it. The values of Leonidas, whose people had practised a peculiarly murderous form of eugenics…. Assumptions that I had grown up with—about how a society should properly be organised, and the principles that it should uphold—were not bred of classical antiquity, still less of ‘human nature’, but very distinctively of that civilisation’s Christian past.”

9secondkox2 · April 21, 2022 8:59PM

Great. Quit investing hundreds of billions in an evil government.

Start a factory in Taiwan and get things going in the USA while you are at it. You’ve already jacked up your prices, so let’s see the love back home.

9secondkox2 · April 21, 2022 9:01PM

AppleZulu said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I think you misunderstand Western culture.

Apparently he misunderstands china’s motive as well. Fighting hard (oppressing your people) to stymie a problem you caused is not a virtuous thing.

9secondkox2 · April 21, 2022 9:17PM

CurtisHight said:

AppleZulu said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I think you misunderstand Western culture.

Tracking and judging culture and history can be sticky business. I trust that I could find many Chinese with deep respect for the value of each human life, even if not themselves Christian as the ones I know best are. With that being said, I note that British Historian Tom Holland’s Dominion: The Making of the Western Mind (U.S. subtitle How the Christian Revolution Remade the World) gives support to Waveparticle. Here from The Guardian review:

“Holland is surely right to argue that when we condemn the moral obscenities committed in the name of Christ, it is hard to do so without implicitly invoking his own teaching.”

Terry Eagleton, “Dominion by Tom Holland review – the legacy of Christianity,” Guardian, November 21, 2019, (https://www.theguardian.com/books/2019/nov/21/dominion-making-western-mind-tom-holland-review).
—
I read the book two years ago. Here are two selections from the preface:

“Just as the Bishop of Oxford refused to consider that he might be descended from an ape, so now are many in the West reluctant to contemplate that their values, and even their very lack of belief, might be traceable back to Christian origins. I assert this with a measure of confidence because, until quite recently, I shared in this reluctance.”

He goes on to write:

“The more years I spent immersed in the study of classical antiquity, so the more alien I increasingly found it. The values of Leonidas, whose people had practised a peculiarly murderous form of eugenics…. Assumptions that I had grown up with—about how a society should properly be organised, and the principles that it should uphold—were not bred of classical antiquity, still less of ‘human nature’, but very distinctively of that civilisation’s Christian past.”

It’s important to note context.

Nobody is blaming Chinese citizenry or those of Chinese descent. It’s is the Chinese government which has committed such atrocities and continues to impose evil on whom it feels it can. That government is made up of people, but they do not represent all chinese people. So for the sake of co text here, “China” means the regime/government. It’s a disservice when people try to blur that distinction and co fuse matters. Let’s get back in focus.

waveparticle · April 21, 2022 9:26PM

9secondkox2 said:

AppleZulu said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I think you misunderstand Western culture.

Apparently he misunderstands china’s motive as well. Fighting hard (oppressing your people) to stymie a problem you caused is not a virtuous thing.

Is AIDS a problem caused by US? How many people have died of AIDS? You are distorting facts.

waveparticle · April 21, 2022 9:32PM

CurtisHight said:

AppleZulu said:

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

I think you misunderstand Western culture.

Tracking and judging culture and history can be sticky business. I trust that I could find many Chinese with deep respect for the value of each human life, even if not themselves Christian as the ones I know best are. With that being said, I note that British Historian Tom Holland’s Dominion: The Making of the Western Mind (U.S. subtitle How the Christian Revolution Remade the World) gives support to Waveparticle. Here from The Guardian review:

“Holland is surely right to argue that when we condemn the moral obscenities committed in the name of Christ, it is hard to do so without implicitly invoking his own teaching.”

Terry Eagleton, “Dominion by Tom Holland review – the legacy of Christianity,” Guardian, November 21, 2019, (https://www.theguardian.com/books/2019/nov/21/dominion-making-western-mind-tom-holland-review).
—
I read the book two years ago. Here are two selections from the preface:

“Just as the Bishop of Oxford refused to consider that he might be descended from an ape, so now are many in the West reluctant to contemplate that their values, and even their very lack of belief, might be traceable back to Christian origins. I assert this with a measure of confidence because, until quite recently, I shared in this reluctance.”

He goes on to write:

“The more years I spent immersed in the study of classical antiquity, so the more alien I increasingly found it. The values of Leonidas, whose people had practised a peculiarly murderous form of eugenics…. Assumptions that I had grown up with—about how a society should properly be organised, and the principles that it should uphold—were not bred of classical antiquity, still less of ‘human nature’, but very distinctively of that civilisation’s Christian past.”

Thanks. Most people don't know culture. Culture is a thing you live with it every day. Unless you do critical thinking, you do not understand the true spirit. The same is true when you look at different culture.

paxman · April 21, 2022 10:21PM

China is really shooting itself in the foot with their incomprehensible Covid policy. The virus is here to stay, everybody will get it, and the more they try to fight it the worst it will get for everyone. I feel very sorry for those millions of locked down folks. F The worst thing for the Chinese government is that they are totally undermining their own credibility with their own people.

waveparticle · April 21, 2022 10:35PM

paxman said:

China is really shooting itself in the foot with their incomprehensible Covid policy. The virus is here to stay, everybody will get it, and the more they try to fight it the worst it will get for everyone. I feel very sorry for those millions of locked down folks. F The worst thing for the Chinese government is that they are totally undermining their own credibility with their own people.

Well, China successfully eliminated covid-19 by May 2020. It has little experience of working with the virus until early this year. It did not have any lock down for almost two years. It does not know how serious the economy will be effected. Now the largest city is experiencing lock down. CCP has noticed the serious problem it caused. It is trying to adjust its policy. If it failed, Chinese economy will be in serious trouble this year.

dewme · April 21, 2022 10:48PM

rob53 said:

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

This is a somewhat pessimistic assessment - but it is unfortunately proving to be the reality of the current situation. Companies like TSMC who the US has been begging to set up shop in the US to fulfill the glorious promise of new jobs for US workers is struggling to find US workers willing to fill those jobs. They are bringing in workers from Taiwan who are willing to work in the US for a couple of years to gain experience and bolster their careers before returning home.

These are jobs that the company is paying workers to be trained to fill, so it's not like the bar is being set too high for people coming out of high school with an interest and willingness to be trained. Yeah, the training may involve some short term training assignments in Taiwan, but who doesn't want to have a company help them jump-start their careers while getting a unique opportunity to see a different part of the world - on someone else's dime? It's not like these US workers are being asked to join the Navy, which also provides the jump-start and see-other-parts-of-the-world things, but also involves working 24x7x365, having zero control over just about every aspect of your life, and being locked in a contract that you cannot walk away from because you don't like your job, hate your your boss, or your feelings are hurt.

If nothing else, the Covid-19 pandemic has taught us that despite whatever levels of technology or automation we throw at solving problems or getting things done, the world still runs on people power. When you can't get the people doing the work that needs to be done, and making automation and supply chains work is still a people driven process, and regardless of the reason, be it man-made or disease borne, the whole system breaks down.

tmay · April 21, 2022 11:27PM

dewme said:

rob53 said:

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

This is a somewhat pessimistic assessment - but it is unfortunately proving to be the reality of the current situation. Companies like TSMC who the US has been begging to set up shop in the US to fulfill the glorious promise of new jobs for US workers is struggling to find US workers willing to fill those jobs. They are bringing in workers from Taiwan who are willing to work in the US for a couple of years to gain experience and bolster their careers before returning home.

These are jobs that the company is paying workers to be trained to fill, so it's not like the bar is being set too high for people coming out of high school with an interest and willingness to be trained. Yeah, the training may involve some short term training assignments in Taiwan, but who doesn't want to have a company help them jump-start their careers while getting a unique opportunity to see a different part of the world - on someone else's dime? It's not like these US workers are being asked to join the Navy, which also provides the jump-start and see-other-parts-of-the-world things, but also involves working 24x7x365, having zero control over just about every aspect of your life, and being locked in a contract that you cannot walk away from because you don't like your job, hate your your boss, or your feelings are hurt.

If nothing else, the Covid-19 pandemic has taught us that despite whatever levels of technology or automation we throw at solving problems or getting things done, the world still runs on people power. When you can't get the people doing the work that needs to be done, and making automation and supply chains work is still a people driven process, and regardless of the reason, be it man-made or disease borne, the whole system breaks down.

Perhaps the difficulty in finding employees is as much a by product of the pandemic as any other cause; there is now a very low rate of unemployment in the U.S., and high tech industries are no exception.

https://thehill.com/homenews/state-watch/598264-ten-states-hit-record-low-unemployment-rates/

waveparticle · April 22, 2022 12:00AM

dewme said:

rob53 said:

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

This is a somewhat pessimistic assessment - but it is unfortunately proving to be the reality of the current situation. Companies like TSMC who the US has been begging to set up shop in the US to fulfill the glorious promise of new jobs for US workers is struggling to find US workers willing to fill those jobs. They are bringing in workers from Taiwan who are willing to work in the US for a couple of years to gain experience and bolster their careers before returning home.

These are jobs that the company is paying workers to be trained to fill, so it's not like the bar is being set too high for people coming out of high school with an interest and willingness to be trained. Yeah, the training may involve some short term training assignments in Taiwan, but who doesn't want to have a company help them jump-start their careers while getting a unique opportunity to see a different part of the world - on someone else's dime? It's not like these US workers are being asked to join the Navy, which also provides the jump-start and see-other-parts-of-the-world things, but also involves working 24x7x365, having zero control over just about every aspect of your life, and being locked in a contract that you cannot walk away from because you don't like your job, hate your your boss, or your feelings are hurt.

If nothing else, the Covid-19 pandemic has taught us that despite whatever levels of technology or automation we throw at solving problems or getting things done, the world still runs on people power. When you can't get the people doing the work that needs to be done, and making automation and supply chains work is still a people driven process, and regardless of the reason, be it man-made or disease borne, the whole system breaks down.

US’ chip bid ‘futile,’ Morris Chang says

TOO COSTLY: Taiwan Semiconductor Manufacturing Co founder Morris Chang said the firm’s assumption that its Oregon chips would cost similar to chips in Taiwan was ‘naive’

By Lisa Wang / Staff reporter

The US’ efforts to increase onshore manufacturing of semiconductors is wasteful and an expensive exercise in futility due to a lack of manufacturing talent and high costs, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) said on Tuesday.

Chang made the remarks in an interview with the Brookings Institution in its latest podcast on the theme “Can semiconductor manufacturing return to the US?”

The semiconductor veteran said that the US today still has a good position in the semiconductor technology industry in terms of chip design capacity, but it lacks sufficient manufacturing talent.

Taiwan Semiconductor Manufacturing Co founder Morris Chang stands next to the company’s logo in an undated photograph.

Photo: Reuters

“I don’t really think it is a bad thing for the US actually. But, it’s a bad thing for trying to do semi manufacturing in the US,” Chang said.

The US used to have strong talent, like Taiwan does now, he said.

However, after the 1970s, young talent in the US migrated to high-paying professions such as finance or consulting, rather than working for technology companies such as GE or IBM, he said.

Since then, US companies just could not get enough business school graduates, he added.

Another challenge is high manufacturing costs, Chang said.

For example, TSMC thought that its factory in Oregon, which was established in 1997, would have costs comparable to Taiwan, but that assumption was proved to be “naive,” he said.

TSMC has attempted to improve the factory’s performance by changing managers and engineers, he said.

While a few years of effort did improve the factory’s performance, the difference in cost between the US and Taiwan remains almost the same, he added.

Chips made at the Oregon factory cost 50 percent more than those make TSMC’s factories in Taiwan, Chang said.

Regarding TSMC’s new US$12 billion factory in Arizona, Chang said he had retired by 2019, but that chairman Mark Liu (劉德音) made the decision at the insistence of the US government.

TSMC, the sole chip supplier for Apple Inc’s iPhones, has said the Arizona factory is under construction, but aims to manufacture 5-nanometer chips by 2024.

Commenting on the US government’s efforts to increase onshore chip manufacturing by spending tens of billions dollars, Chang said: “I think it will be a very expensive exercise in futility.”

“The US will increase onshore manufacturing of semiconductors somewhat,” Chang said. “All that will be at a very high cost increase, high unit costs, but non-competitive in the world market when you compete with factories like TSMC.”

Regarding Intel CEO Pat Gelsinger’s remarks that “Taiwan is not safe,” Chang said he assumes that there will not be a war.

“If there is no war, then I think the efforts to increase onshore manufacturing of semiconductors is a wasteful and expensive exercise in futility, ”he said. “If there is a war, we all have a lot more than just chips to worry about.”

https://www.taipeitimes.com/News/biz/archives/2022/04/22/2003776996

tmay · April 22, 2022 12:55AM

waveparticle said:

dewme said:

rob53 said:

And where would they go? India? Definitely not the USA because no company would be able to find enough Americans willing to do the type of work needed. All the USA produces are lawyers and MBAs, not people who can actually use their hands and brains in combination.

This is a somewhat pessimistic assessment - but it is unfortunately proving to be the reality of the current situation. Companies like TSMC who the US has been begging to set up shop in the US to fulfill the glorious promise of new jobs for US workers is struggling to find US workers willing to fill those jobs. They are bringing in workers from Taiwan who are willing to work in the US for a couple of years to gain experience and bolster their careers before returning home.

These are jobs that the company is paying workers to be trained to fill, so it's not like the bar is being set too high for people coming out of high school with an interest and willingness to be trained. Yeah, the training may involve some short term training assignments in Taiwan, but who doesn't want to have a company help them jump-start their careers while getting a unique opportunity to see a different part of the world - on someone else's dime? It's not like these US workers are being asked to join the Navy, which also provides the jump-start and see-other-parts-of-the-world things, but also involves working 24x7x365, having zero control over just about every aspect of your life, and being locked in a contract that you cannot walk away from because you don't like your job, hate your your boss, or your feelings are hurt.

If nothing else, the Covid-19 pandemic has taught us that despite whatever levels of technology or automation we throw at solving problems or getting things done, the world still runs on people power. When you can't get the people doing the work that needs to be done, and making automation and supply chains work is still a people driven process, and regardless of the reason, be it man-made or disease borne, the whole system breaks down.

US’ chip bid ‘futile,’ Morris Chang says
TOO COSTLY: Taiwan Semiconductor Manufacturing Co founder Morris Chang said the firm’s assumption that its Oregon chips would cost similar to chips in Taiwan was ‘naive’
By Lisa Wang / Staff reporter

The US’ efforts to increase onshore manufacturing of semiconductors is wasteful and an expensive exercise in futility due to a lack of manufacturing talent and high costs, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) said on Tuesday.
Chang made the remarks in an interview with the Brookings Institution in its latest podcast on the theme “Can semiconductor manufacturing return to the US?”
The semiconductor veteran said that the US today still has a good position in the semiconductor technology industry in terms of chip design capacity, but it lacks sufficient manufacturing talent.
Taiwan Semiconductor Manufacturing Co founder Morris Chang stands next to the company’s logo in an undated photograph.
Photo: Reuters
“I don’t really think it is a bad thing for the US actually. But, it’s a bad thing for trying to do semi manufacturing in the US,” Chang said.
The US used to have strong talent, like Taiwan does now, he said.
However, after the 1970s, young talent in the US migrated to high-paying professions such as finance or consulting, rather than working for technology companies such as GE or IBM, he said.
Since then, US companies just could not get enough business school graduates, he added.
Another challenge is high manufacturing costs, Chang said.
For example, TSMC thought that its factory in Oregon, which was established in 1997, would have costs comparable to Taiwan, but that assumption was proved to be “naive,” he said.
TSMC has attempted to improve the factory’s performance by changing managers and engineers, he said.
While a few years of effort did improve the factory’s performance, the difference in cost between the US and Taiwan remains almost the same, he added.
Chips made at the Oregon factory cost 50 percent more than those make TSMC’s factories in Taiwan, Chang said.
Regarding TSMC’s new US$12 billion factory in Arizona, Chang said he had retired by 2019, but that chairman Mark Liu (劉德音) made the decision at the insistence of the US government.
TSMC, the sole chip supplier for Apple Inc’s iPhones, has said the Arizona factory is under construction, but aims to manufacture 5-nanometer chips by 2024.
Commenting on the US government’s efforts to increase onshore chip manufacturing by spending tens of billions dollars, Chang said: “I think it will be a very expensive exercise in futility.”
“The US will increase onshore manufacturing of semiconductors somewhat,” Chang said. “All that will be at a very high cost increase, high unit costs, but non-competitive in the world market when you compete with factories like TSMC.”
Regarding Intel CEO Pat Gelsinger’s remarks that “Taiwan is not safe,” Chang said he assumes that there will not be a war.
“If there is no war, then I think the efforts to increase onshore manufacturing of semiconductors is a wasteful and expensive exercise in futility, ”he said. “If there is a war, we all have a lot more than just chips to worry about.”
https://www.taipeitimes.com/News/biz/archives/2022/04/22/2003776996

“If there is no war, then I think the efforts to increase onshore manufacturing of semiconductors is a wasteful and expensive exercise in futility, ”he said. “If there is a war, we all have a lot more than just chips to worry about.”

Yeah, because nobody, excepting Eastern Europeans anyway, believed that Russia would mount a full scale invasion of Ukraine, an invasion that Russia sucks so bad at, that they fall back to their standard genocide of civilians and destruction of cities.

This might cause the PRC some reevaluation on their Taiwan policy, but ultimately. they want Taiwan, and by force, if necessary.

spock1234 · April 22, 2022 1:24AM

waveparticle said: And where would they go? India?

Why not India? Apple is already making iPhone 13 there.

Chang said he assumes that there will not be a war. “If there is no war, then I think the efforts to increase onshore manufacturing of semiconductors is a wasteful and expensive exercise in futility, ”he said. “If there is a war, we all have a lot more than just chips to worry about.”

No, Taiwan will ‘have a lot more than chips to worry about than chips’. If we had US based manufacturing, who runs Taiwan will not make much difference to Americans.

“There will not be a war” Riiiight! The CCP is just going to abandon a founding principle of the PRC, on which they have not given an inch, even in the face of united world opposition. But, now that Mr. Chang said so, yeah, we’ll just let that go ….

Honestly, I would think it would be in TMSC’s interest to have manufacturing in another safe country. Right now, they are sitting ducks, just one Chinese bomb away from the loss of 100% of Apple’s chip supply. I won’t offer Apple any advice here, as I am sure Tim has his best men on it.

maciekskontakt · April 22, 2022 9:42PM

That is until people stop eating bats that may have viruses there

Honestly, China shot itself in leg with that aggressive research that is on verge of manufacturing biological weapons. You reap what you sow.

StrangeDays · April 22, 2022 10:21PM

waveparticle said:

JWSC said:

Assuming this is true, the recent Shanghai lockdowns have provided Apple with a politically acceptable excuse (from a CCP perspective) for Apple to move a large percentage of its supply chain outside China. Apple can point to 'supply chain instability' as a business reason, rather than the more concerning aspect of being reliant on business entities within a totalitarian regime that thinks little of human rights. Apple doesn't want to talk about that with China for fear that it would put them in bad standing with CCP officials. But the supply chain excuse can be viewed as non-political.

As defined by western culture. China fighting hard to combat covid is not regarded as human rights by western culture. The western culture regards freedom far supersedes human life. Because Christianity thinks our life is given by God. Death is not regarded termination of life.

China's human rights issues aren't about its COVID measures. It's about their authoritarian regime that has no issue detaining citizens in labor camps, ethnic cleaning, forced organ harvesting, and disappearing (ie, murdering) political dissenters. See Tank Man.

Apple looks to move away from China for its new products, says Kuo

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US’ chip bid ‘futile,’ Morris Chang says

TOO COSTLY: Taiwan Semiconductor Manufacturing Co founder Morris Chang said the firm’s assumption that its Oregon chips would cost similar to chips in Taiwan was ‘naive’

Taiwan Semiconductor Manufacturing Co founder Morris Chang stands next to the company’s logo in an undated photograph.

US’ chip bid ‘futile,’ Morris Chang says

TOO COSTLY: Taiwan Semiconductor Manufacturing Co founder Morris Chang said the firm’s assumption that its Oregon chips would cost similar to chips in Taiwan was ‘naive’

Taiwan Semiconductor Manufacturing Co founder Morris Chang stands next to the company’s logo in an undated photograph.