Taipei:Elon Musk's ambitious plan to construct a large semiconductor fabrication complex in Texas is not expected to affect Taiwan Semiconductor Manufacturing Co. (TSMC) in the near future. Kirk Yang, an experienced semiconductor analyst, stated on Wednesday that such a project would require five to ten years to come to fruition.
According to Focus Taiwan, Kirk Yang, chairman and CEO of Kirkland Capital LLC, explained that building a leading-edge chip foundry is a highly complex task. Even for TSMC, the world's largest contract chipmaker, creating and scaling a new fab takes several years.
Yang mentioned that if Musk, who oversees companies like Tesla Inc. and SpaceX, succeeds in establishing a chip fab, it would likely take five to ten years before becoming operational. He emphasized that this proposed "Terafab" in Grimes County, Texas poses "absolutely no impact" on TSMC in the short or medium term. He also noted that numerous multinational companies have struggled to enter semiconductor manufacturing due to technological barriers and significant capital requirements.
Despite these challenges, Yang expressed confidence in Musk's long-term ability to execute the project, considering his successful track record at Tesla and SpaceX. The global chip shortage during the COVID-19 pandemic and U.S.-China trade tensions have increased U.S. companies' interest in vertically integrating their supply chains, including chip design and manufacturing.
Yang also mentioned Musk's intention to invest approximately US$3 billion in a pilot fab, which may involve U.S. partners like Intel. This aligns with Washington's goal for domestic companies to play a pivotal role in semiconductor manufacturing. Looking ahead, Yang suggested that TSMC could benefit if Musk implements a sublease model and collaborates with TSMC for technical consulting or leasing space at the facility. He added that Intel could eventually become a competitor to TSMC, although this is unlikely in the short term. Closer ties between TSMC and Intel might foster better mutual understanding.