- AMD’s CEO indicated that chips made in TSMC’s US factories will likely be pricier
- Lisa Su says they may very well be 5% to twenty% costlier than chips produced in Taiwan
- Su argues that the price is price it when it comes to diversifying the provision chain
AMD’s CEO has admitted that the corporate’s chips will likely be a good bit pricier when they’re produced in TSMC’s factories within the US (versus Taiwan).
Bloomberg studies that it is going to be costlier to supply chips from TSMC’s new Arizona plant than its Taiwan factories. TSMC is the chip maker that AMD makes use of to fabricate most of its processors and GPUs, and AMD is ready to start out receiving chips from the Arizona plant earlier than the tip of 2025).
At an AI occasion, CEO Lisa Su stated that US chips will likely be “greater than 5% however lower than 20%” costlier in comparison with “comparable” elements produced in Taiwan. The chief govt additionally noticed that yields within the US plant are similar to TSMC’s Taiwanese amenities. (The yield is the share of chips that make the grade for use in a completed product – not each piece of silicon does, and chips in that class are sometimes repurposed for lower-tier {hardware}).
In an interview with Bloomberg that adopted the occasion, Su argued that any further expense was worthwhile when it comes to diversifying the place AMD is outsourcing its manufacturing. The chief govt stated: “We now have to contemplate resiliency within the provide chain. We discovered that within the pandemic.”
Su additionally underlined that the demand for AI chips, wherever they’re produced, is not going wherever and stays large – which is not information to anybody, in fact.
Evaluation: It is nonetheless early days for TSMC US
Whereas yields could also be comparable (or so we’re informed), what Su does not point out is that TSMC’s most superior processes are unique to its manufacturing amenities in Taiwan. Arizona solely goes so far as the N4 node, which is 4nm – whereas the cutting-edge manufacturing course of for TSMC is now 2nm.
Ultimately, although, the plan is to fabricate these extra superior merchandise within the US – the funding in Arizona is a big one, in spite of everything – however for now, that is merely about including variety, as Su signifies.
Nonetheless, all of the items of that variety puzzle aren’t in place but, at the very least in keeping with current studies, which observe that AMD nonetheless has to ship some US-made chips again to Taiwan for ending (in the event that they want superior packaging utilized).
Tthe plan is for that to occur within the US finally – however for now, there’s seemingly this clunky and moderately impractical workaround in place as a part of the push to get extra chips out of the door (to fulfill AI demand, which is, as talked about, enormous).
That may very well be one of many explanation why prices could also be inflated, alongside doubtlessly greater prices for being primarily based within the US within the first place (comparable to labor, maybe).
Su’s estimate is kind of wide-ranging right here, and a worth leap of 5% to twenty% is a large gulf. The previous appears comparatively trivial, the latter represents a a lot much less palatable hike – slapping 20% on the price of a typical Ryzen workhorse CPU would stick $50 on prime, or thereabouts (going by the MSRP of the Ryzen 9600X, which admittedly is promoting for lots cheaper now).
Okay, so you may’t boil this situation right down to that consequence – there are much more elements to contemplate right here, together with that Su’s estimate is moderately obscure – however the greater finish of the size offered for the potential value improve is considerably regarding, for certain.
As is the truth that this is not just a few rumor floating down from an nameless supply someplace within the provide chain, however that it comes from the CEO herself.
