Apple and TSMC have had a long and successful partnership. The Cupertino juggernaut has always been first in line for TSMC’s most advanced nodes, and these chips have always come from Taiwan. But in light of the recent supply chain mess, Apple and other companies are looking for ways to diversify their chip sources. TSMC will reportedly begin production of 3nm designs at its Arizona fab in early 2024. This could allow Apple to boast it’s using American-made silicon for the first time. However, Bloomberg is reporting it will likely amount to nothing more than a PR stunt.
News of Apple’s plans came in a recent meeting with employees in Germany featuring CEO Tim Cook. Bloomberg’s Mark Gurman, who is a noted Apple beat reporter, noted TSMC produces 60 percent of the world’s semiconductor products. In light of this Cook remarked, “Regardless of what you may feel and think, 60 percent coming out of anywhere is probably not a strategic position” according to Engadget. To resolve this situation, TSMC will reportedly begin producing chips for Apple in a new facility in Arizona. The company already has fabs in Arizona, but 3nm production will be coming from a new plant. The company will also begin 5nm production in Arizona in 2024.
Moving some of its most advanced technologies to the states is a big deal for TSMC. However, it is unclear if Apple will be able to acquire 3nm chips from the Arizona fab any time soon. TSMC is supposedly just now starting production of this advanced process in Taiwan. It’s anticipated to be using this cutting-edge node for the A17 chip in the upcoming iPhone 15. It also has 3nm plans for future M2 chips as well. However, the news of TSMC bringing 3nm to Arizona and Apple using “US-made chips” may not be linked.
According to a Bloomberg Analyst, Apple will indeed use chips from Arizona, but they probably won’t be 3nm. Per 9to5mac, Bloomberg’s Tim Culpan thinks it’s mostly a “symbolic gesture.” Instead of leaning on TSMC for its most advanced designs, Apple will likely use mature nodes for lesser parts in its flagship devices, or SoCs for less notable products. Those include the AirPods, HomePod, Apple TV, and Watch.
Even if the site in Arizona does begin making M-class silicon or A-class chips for iPhone, it’ll be at an extremely low volume. It’s reported TSMC’s new facility will produce 20,000 wafers a month. In contrast, TSMC as a whole makes 1.3 million wafers a month in Taiwan currently. That means the new facility will provide a measly 1.6 percent of that capacity. In other words, as Bloomberg states, it’s more of a marketing campaign than anything else.
To be fair to Tim Apple, he didn’t say which company would be producing chips in Arizona. However, the only other fabs in that state belong to Intel. If he was actually referring to Chipzilla, that would be a huge announcement. However, given its long relationship with TSMC along with the company’s advanced node leadership, it’s clear he was referring to TSMC. Besides, the two companies reportedly tussled over pricing recently, with Apple bowing to the demands of its sole supplier. It appears the two companies will be joined at the proverbial hip, for the next few years at least.
Still, it’s a big move for Apple to procure chips outside of Taiwan. Nvidia and AMD are also big TSMC customers, of course, and are currently using TSMC’s 5nm process for their latest CPUs and GPUs. Perhaps once the Arizona fab has expanded capacity, other companies might entertain the notion of buying silicon stateside as well.
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