US-manufactured microchips come costly
(MENAFN) Producing microchips in the United States can cost up to 20% more than manufacturing the same chips in Taiwan, according to Lisa Su, CEO of AMD. The U.S. semiconductor company is a major buyer of these advanced components, and Su spoke about the cost disparity during an AI conference in Washington this week.
While the chip price gap typically ranges between 5% and 20%, Su told Bloomberg TV that the higher costs are justified. “We have to factor in supply chain resiliency,” she said, noting that the COVID-19 pandemic revealed vulnerabilities in global manufacturing networks.
The U.S. has been working to strengthen its domestic semiconductor industry amid strategic tensions with China. In 2022, President Joe Biden signed a $280 billion initiative aimed at reviving chip production in the country. More recently, AMD and President Donald Trump announced a $100 billion plan to construct five new chip fabrication facilities across the U.S.
Taiwan Semiconductor Manufacturing Company (TSMC), the world’s top chipmaker, committed in 2020 to opening a facility in Arizona. However, the company has encountered obstacles in the U.S., including high building expenses, a lack of skilled labor, and logistical issues.
Washington has also implemented export controls on high-performance AI chips to limit China’s access to advanced technologies. This move has prompted Beijing to intensify efforts to develop its own domestic chip industry.
Taiwan, which has operated independently since China’s civil war in the 1940s, plays a central role in the global semiconductor market. TSMC, founded in 1987, was part of Taiwan’s strategy to shift toward high-tech manufacturing during its rapid industrialization in the 1970s. Beijing continues to assert sovereignty over the island and has warned against any formal declaration of independence.
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