Taipei: The United States government's alleged plan to encourage Taiwan Semiconductor Manufacturing Co. (TSMC) to form a joint venture with Intel is expected to place the Taiwanese foundry giant in a more disadvantageous position than the proposed tariffs on imported chips, according to a semiconductor expert.

According to Focus Taiwan, Liu Pei-chen, a researcher at the Taiwan Industry Economics Database of the Taiwan Institute of Economic Research (TIER), expressed concerns about the potential risks associated with a joint venture between TSMC and its U.S. rival Intel. Liu highlighted the risk of technology outflow if such a partnership were to materialize.

Liu's comments followed a report by international financial services firm Baird, which indicated that discussions within the Asia semiconductor supply chain suggest the U.S. government will request TSMC to dispatch engineers to Intel's 3nm/2nm fab. This move would involve applying TSMC's know-how to ensure the viability of both the fab and subsequent manufacturing projects from Intel.

While TSMC has previously established production facilities in Dresden, Germany, and Kumamoto, Japan through joint ventures, these collaborations have involved local businesses that are TSMC's customers. Liu pointed out that a joint venture with Intel would inevitably center on advanced semiconductor technology, posing a risk of technology leaks that could jeopardize TSMC's leading edge.

Particularly in light of U.S. President Donald Trump's commitment to prioritizing American interests, Liu noted that cooperation with Intel may place TSMC at a disadvantage. TSMC's leadership in advanced technology is irreplaceable, granting it strong bargaining power. Liu added that if the U.S. were to impose tariffs on imported chips, the increased costs could be passed on to TSMC's American clients.

Liu explained that forming a joint venture with Intel would be a worse choice for TSMC compared to Trump's chip tariff plan. Intel is currently facing operational difficulties and technological bottlenecks, while TSMC maintains a leading position in technology. A TSMC-Intel joint venture could aid Intel in overcoming its challenges and bolster the development of the U.S. semiconductor manufacturing industry.

Additionally, TSMC Chairman C.C. Wei has stated that the company has no interest in acquiring Intel's chip manufacturing facilities following the U.S. firm's spin-off of its foundry business. Baird analyst Tristan Gerra remarked that while there is no confirmation, the potential completion of this project could take a long time. He noted that the move would make sense, further building on Intel's prior CEO's focus on the company's core competency in manufacturing.