AMD CEO Lisa Su reveals that American-made TSMC semiconductors are 5-20% more expensive
AMD CEO Lisa Su said Taiwan-based semiconductor manufacturer TSMC's Arizona plant will be 'more expensive than Taiwan,' but said there are benefits to diversifying the supply chain.
AMD CEO Says Chips From TSMC's US Plant Cost 5% to 20% More - Bloomberg
AMD CEO says US-made TSMC chips are more expensive, but worth it — costs 'more than 5% but less than 20%' higher than Taiwan-sourced alternative | Tom's Hardware
AMD, which outsources manufacturing to TSMC, has semiconductors manufactured at a factory in Arizona, USA, in addition to a factory in Taiwan. CEO Su, who appeared at an AI-related event, pointed out that 'the Arizona factory is more than 5% to less than 20% more expensive than Taiwan,' making it clear that the Arizona factory is expensive.
'Splitting manufacturing into multiple locations also has the benefit of reducing supply bottlenecks,' Su continued. He said it's worth the extra cost because it would reduce the risk of factory closures and supply chain disruptions, as was seen in the early stages of the COVID-19 pandemic.
The Arizona plant's high costs are due to TSMC's high pricing. TSMC says that outside of Taiwan, the cost of manufacturing chips is rising due to inflation and rising electricity prices, and that in order to achieve its target gross profit margin, it has no choice but to charge extra at its manufacturing sites outside of Taiwan. By adding on prices, it can close the gap between manufacturing costs and profits.
TSMC's US-made chips are more expensive than Taiwanese chips, but reservations are already full until the second half of 2027 - GIGAZINE
AMD plans to ship the first chips manufactured at TSMC's Arizona fab by the end of 2025. TSMC continues to expand its production facilities to meet growing demand for semiconductors and has also decided to build a third fab in Arizona.
TSMC begins construction of third factory in Arizona, Commerce Secretary Lutnick appeals that 'Trump tariffs allowed us to attract TSMC investment without paying a single dollar' - GIGAZINE
'What we've learned through the pandemic is that the supply chain needs to be looked at not just in terms of low cost, but in terms of reliability and other factors,' said Su. 'Although it will cost a little more, the efforts to promote semiconductor investment have been helpful. I think investing in the United States is a very good investment for us.'
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