From ExtremeTech: The silicon wars are heating up. Earlier this year, TSMC announced that it would increase its capital expenditures for the year to $28 billion, up from $18.17 billion in 2020. Now the company is promising to spend $100 billion over the next three years. If we assume the funds will be split evenly by years, TSMC is raising its capital expenditures (CapEx) by a further 18 percent.
Intel, Samsung, and TSMC have all announced plans to boost their manufacturing capacities and pour more funding into researching new manufacturing techniques and materials. The ping-pong between companies has been something to see. After Intel CEO Pat Gelsinger said the current global reliance on Asia for chip manufacturing wasn’t “palatable,” TSMC chairman Mark Liu argued that efforts to build new foundries in the US and Europe were unrealistic and would result in money-losing factories. According to him, the shortage is being driven by double bookings and allocation problems, with the former caused by uncertainty in the US-China relationship. “Uncertainties led to double booking, but actual capacity is larger than demand,” Liu said.
There’s definitely truth to this statement, but we have to be careful when we discuss which chips it applies to. In this context, Liu was specifically discussing automotive chips, which are often built on the older 28nm process nodes. According to TSMC, it’s doing its best to distinguish which customer orders are panic-buying and which represent legitimate need, but that’s not always possible for the foundry to determine. Liu isn’t speaking to the question of whether there’s a crunch on leading-edge nodes. He’s referring to how much additional capacity TSMC should add to deal with 28nm when the increased demand for that node may be a short-term situation.
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