Topic: TSMC founder Morris Chang says globalization 'almost dead' (Read 72 times)
Globalization is neither bad nor good, it is simply another stage in the development of the world economy. More precisely, the transition from isolated local economies to global ones. Globalization assumes that this process works fine if all participants in the market and this scheme, the economy receives a reduction in overhead costs, a deeper connection to global processes of local companies, etc. Those. it all works when all participants make the necessary efforts, and behave adequately. But when someone decides to appoint himself the "navel of the earth", try to impose his conditions on everyone, hint at economic sabotage and other actions that can hardly be called adequate - the scheme of how the body begins to reject the "alien body". I am sure that Globalization will not go anywhere, it will simply transform. Either throwing such players out of the global scheme, or leaving them in the role of a raw material appendage, but nothing more. It's a normal defense mechanism...
when it comes to quantifying the price of fixxil fuel for container ships. vs the cost per unit of product in a container.
you are talking about individual products of dollars vs the transport costr of micro pennies
you can store hundreds OF THOUSANDS of microchips in one 20ft container
the shipping cost for that one container is less than $1k
meaning the transport per unit is penny rated not dollar rated
you find that its the FOREX rate of trade deals that affect prices more. not fuel cost
but if fossil fuel was dropped
you would still find that the amount of battery store to drive the ships engines would take up less space than a fuel tank,
they can run more solar and wind energy generation than required.
so again its not a big deal
dont expect things to move back to wooden boats filled with slaves manning he sails or rowing the ores when the winds die down, just to transport what amounts to a quarter of a shipping container of goods at a time
you are talking about individual products of dollars vs the transport costr of micro pennies
you can store hundreds OF THOUSANDS of microchips in one 20ft container
the shipping cost for that one container is less than $1k
meaning the transport per unit is penny rated not dollar rated
you find that its the FOREX rate of trade deals that affect prices more. not fuel cost
but if fossil fuel was dropped
you would still find that the amount of battery store to drive the ships engines would take up less space than a fuel tank,
they can run more solar and wind energy generation than required.
so again its not a big deal
dont expect things to move back to wooden boats filled with slaves manning he sails or rowing the ores when the winds die down, just to transport what amounts to a quarter of a shipping container of goods at a time
He didn't explain his comments because he doesn't have facts or reliable data to back them.
Globalization and global markets depend on energy sources with a high density or high efficiency to make global trade affordable.
What if fossil fuel powered container ships were forced to regress to sails and wind power. The low cost of labor might no longer offset the high cost of shipping. If that is accurate, then the high dollar cost of fossil fuels could naturally be detrimental to globalization, global markets and global trade.
In which case, we would see a shift towards local production and manufacturing.
Unfortunately, he doesn't elaborate upon his comments on globalization and free trade being dead. Most will not recognize what he is referring to. The implications and after effects however could be significant and widespread. If there is a transition from a global economy to local economy, it will not be a smooth transition. The edifice of laws and regulation are structured to facilitate globalization, rather than local production and manufacturing. Businesses and job markets would have difficulty switching up labor markets and supply chains.
Everyone who supported free markets 10 years ago, appears to have left the civilized world to live in isolated cabins in the woods. Maybe that is our most accurate indicator of free trade and free markets no longer having many supporters globally? The silent shift in public opinion has been deafening.
Will globalization make a return, TSMC's founder believes it will not. The concept of globalization was always dependent upon oil and one might say it wouldn't have survived past peak oil anyway.
He didn't explain his comments because he doesn't have facts or reliable data to back them. It is true that so many economists and financial experts are predicting the death of globalization due to the US-China trade war, Covid-I9, Russian invasion of Ukraine and the scrambling for energy. But this has turned out to be false.
The truth is the global economy is evolving and important global actors are changing partners and strategies. Russia that was once a key trading partner of the EU is now shifting its partnership to China and India. The US economy that was once heavily connected to China is now dealing with other Asian countries like Vietnam and reconnecting to the EU economy. Countries would keep relying on others because of competitive advantage which would continue to promote globalization. The only changes might be that from time to time due to some factors, most countries would change global partners and policies to suit their national interest.
since when has trade been free.
everything has its price..
if it didnt then it wouldnt be trade. it will be donation/gifting
media will say that we are on brinks of war and that we are segregating countries and isolating others. and how americans should hate china. etc etc
yet while corporations are sponsoring media to tell small business "blame china, stay away from china".. big corporations are still doing business with china. they just dont want the local mom&pop small businesses becoming competition for big corporations
ofcourse TSMC want to say they are "coming to america" to feed the locals with chips. but those chips at higher prices will filter to the small business. to cost them out of being competitive, while the big corps will source their lower nm chips at lower prices from the cheaper market of asia, as always
yep small silicon valley startups get to buy 4-6nm chips at american inflated market rate
while big corps are using 3-4nm chips at lower asia rates.
all while sponsoring media to tell small startups "dont source your chips from asia"
yep TSMC themselves have been telling certain groups to not buy from their own company in taiwan... while their taiwan factories are still contracted to make chips for big corp america..funny right
everything has its price..
if it didnt then it wouldnt be trade. it will be donation/gifting
media will say that we are on brinks of war and that we are segregating countries and isolating others. and how americans should hate china. etc etc
yet while corporations are sponsoring media to tell small business "blame china, stay away from china".. big corporations are still doing business with china. they just dont want the local mom&pop small businesses becoming competition for big corporations
ofcourse TSMC want to say they are "coming to america" to feed the locals with chips. but those chips at higher prices will filter to the small business. to cost them out of being competitive, while the big corps will source their lower nm chips at lower prices from the cheaper market of asia, as always
yep small silicon valley startups get to buy 4-6nm chips at american inflated market rate
while big corps are using 3-4nm chips at lower asia rates.
all while sponsoring media to tell small startups "dont source your chips from asia"
yep TSMC themselves have been telling certain groups to not buy from their own company in taiwan... while their taiwan factories are still contracted to make chips for big corp america..funny right
Quote
PHOENIX, U.S. -- The father of Taiwan's chip industry said geopolitics have drastically changed the situation facing semiconductor makers and warned that "globalization and free trade are almost dead," and unlikely to come back.
Morris Chang, founder of Taiwan Semiconductor Manufacturing Co., was speaking at an event in Phoenix, Arizona, on Tuesday where the company marked the symbolic first equipment installation at its new plant.
It is TSMC's first advanced chip plant in the U.S. in more than two decades, and Chang said a lot of "hard work" remained to make it a success.
He compared the current $40 billion project to when TSMC built its first plant in the U.S. in Camas, Washington, in 1995, just eight years after the world's biggest contract chipmaker was founded.
"Twenty-seven years have passed and [the semiconductor industry] witnessed a big change in the world, a big geopolitical situation change in the world," Chang said. "Globalization is almost dead and free trade is almost dead. A lot of people still wish they would come back, but I don't think they will be back."
His comments come amid growing fears that tensions between the U.S. and China over chips are splitting the global tech supply chain into two camps. Washington's crackdown on Beijing's chip ambitions, seen most recently in new restrictions rolled out in October, have made it increasingly difficult for companies like TSMC to serve clients in China.
Chang said he had always dreamed of building a chip plant, or fab, in the U.S. because of his own background. He was educated and worked in the U.S. for several decades. But his first experience did not go smoothly.
"It was, I thought, a dream fulfilled," Chang said. "But it [the first plant] ran into cost problems. We ran into people problems, we ran into cultural problems. The dream fulfilled became a nightmare fulfilled. It took us several years to untangle ourselves from my nightmare, and I decided that I needed to postpone the dream."
In the decades that followed, TSMC focused on building up cutting-edge chip production capacity in its home market, a strategy that helped the company keep costs down while continually honing its technological know-how.
Chang said the tool installation event -- an important milestone in building a chip plant -- signaled the end of one phase in making its U.S. bid pay off.
"The romance of the beginning is lost and the initial excitement is gone. A lot of hard work remains," the industry veteran said. But Chang added that TSMC is much more "prepared" than its first time building a chip plant in the U.S. with the support of the U.S. government.
A large delegation of top chip and tech industry CEOs attended the event, as did U.S. President Joe Biden, who lauded the plant as a win for the U.S. in its push to make cutting-edge chips domestically. TSMC announced the same day that it will triple its Arizona investment to $40 billion in order to bring its most advanced chip technology to the country.
Washington has cited national security concerns and supply issues for wanting to bring vital semiconductor production back to its shores. Many industry executives agree that the era of globalization is retreating, and that sourcing locally is now a top priority.
Lisa Su, CEO of chip developer AMD, told Nikkei Asia on the sidelines of the event that supply chain continuity is now one of the top priorities for companies like hers.
"The entire semiconductor ecosystem is ready to step up and work together. ... The industry has been through so much in the past few years. Having more geographically diversified capacity is so important," Su said, referring to the unprecedented chip shortage. "At the end of the day, what we want to do is ensure that our most important chips have a resilient supply chain."
Apple CEO Tim Cook also embraced the idea of onshoring chip production despite his company for years relying on global suppliers to lower the costs of its "designed in the U.S." products.
"Over the past several years, the progress we've made with Apple silicon has transformed our devices. It has unlocked new levels of performance for our users, enabling them to do things they could never do before," said Cook at the event. "And now, thanks to the hard work of so many people, these chips can be proudly stamped 'Made in America.' This is an incredibly significant moment. It's the chance for the United States to usher in a new era in advanced manufacturing."
"Building fabs is clearly very hard work," Nvidia CEO Jensen Huang told Nikkei Asia on the sidelines. "Today's event is marking that TSMC will be a fundamental partner of every company's aim for [supply chain] resilience. It will make TSMC even stronger. As TSMC increases its own supply chain resilience [by building a fab in the U.S.], it will give us resilience, too."
Apple, AMD and Nvidia are set to be among the first customers for TSMC's Arizona plant.
https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-founder-Morris-Chang-says-globalization-almost-dead
Morris Chang, founder of Taiwan Semiconductor Manufacturing Co., was speaking at an event in Phoenix, Arizona, on Tuesday where the company marked the symbolic first equipment installation at its new plant.
It is TSMC's first advanced chip plant in the U.S. in more than two decades, and Chang said a lot of "hard work" remained to make it a success.
He compared the current $40 billion project to when TSMC built its first plant in the U.S. in Camas, Washington, in 1995, just eight years after the world's biggest contract chipmaker was founded.
"Twenty-seven years have passed and [the semiconductor industry] witnessed a big change in the world, a big geopolitical situation change in the world," Chang said. "Globalization is almost dead and free trade is almost dead. A lot of people still wish they would come back, but I don't think they will be back."
His comments come amid growing fears that tensions between the U.S. and China over chips are splitting the global tech supply chain into two camps. Washington's crackdown on Beijing's chip ambitions, seen most recently in new restrictions rolled out in October, have made it increasingly difficult for companies like TSMC to serve clients in China.
Chang said he had always dreamed of building a chip plant, or fab, in the U.S. because of his own background. He was educated and worked in the U.S. for several decades. But his first experience did not go smoothly.
"It was, I thought, a dream fulfilled," Chang said. "But it [the first plant] ran into cost problems. We ran into people problems, we ran into cultural problems. The dream fulfilled became a nightmare fulfilled. It took us several years to untangle ourselves from my nightmare, and I decided that I needed to postpone the dream."
In the decades that followed, TSMC focused on building up cutting-edge chip production capacity in its home market, a strategy that helped the company keep costs down while continually honing its technological know-how.
Chang said the tool installation event -- an important milestone in building a chip plant -- signaled the end of one phase in making its U.S. bid pay off.
"The romance of the beginning is lost and the initial excitement is gone. A lot of hard work remains," the industry veteran said. But Chang added that TSMC is much more "prepared" than its first time building a chip plant in the U.S. with the support of the U.S. government.
A large delegation of top chip and tech industry CEOs attended the event, as did U.S. President Joe Biden, who lauded the plant as a win for the U.S. in its push to make cutting-edge chips domestically. TSMC announced the same day that it will triple its Arizona investment to $40 billion in order to bring its most advanced chip technology to the country.
Washington has cited national security concerns and supply issues for wanting to bring vital semiconductor production back to its shores. Many industry executives agree that the era of globalization is retreating, and that sourcing locally is now a top priority.
Lisa Su, CEO of chip developer AMD, told Nikkei Asia on the sidelines of the event that supply chain continuity is now one of the top priorities for companies like hers.
"The entire semiconductor ecosystem is ready to step up and work together. ... The industry has been through so much in the past few years. Having more geographically diversified capacity is so important," Su said, referring to the unprecedented chip shortage. "At the end of the day, what we want to do is ensure that our most important chips have a resilient supply chain."
Apple CEO Tim Cook also embraced the idea of onshoring chip production despite his company for years relying on global suppliers to lower the costs of its "designed in the U.S." products.
"Over the past several years, the progress we've made with Apple silicon has transformed our devices. It has unlocked new levels of performance for our users, enabling them to do things they could never do before," said Cook at the event. "And now, thanks to the hard work of so many people, these chips can be proudly stamped 'Made in America.' This is an incredibly significant moment. It's the chance for the United States to usher in a new era in advanced manufacturing."
"Building fabs is clearly very hard work," Nvidia CEO Jensen Huang told Nikkei Asia on the sidelines. "Today's event is marking that TSMC will be a fundamental partner of every company's aim for [supply chain] resilience. It will make TSMC even stronger. As TSMC increases its own supply chain resilience [by building a fab in the U.S.], it will give us resilience, too."
Apple, AMD and Nvidia are set to be among the first customers for TSMC's Arizona plant.
https://asia.nikkei.com/Business/Tech/Semiconductors/TSMC-founder-Morris-Chang-says-globalization-almost-dead
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So it seems TSMC's first attempt to deploy semiconductor manufacturing in the united states occurred in 1995:
Quote
"It was, I thought, a dream fulfilled," Chang said. "But it [the first plant] ran into cost problems. We ran into people problems, we ran into cultural problems. The dream fulfilled became a nightmare fulfilled. It took us several years to untangle ourselves from my nightmare, and I decided that I needed to postpone the dream."
Unfortunately, he doesn't elaborate upon his comments on globalization and free trade being dead. Most will not recognize what he is referring to. The implications and after effects however could be significant and widespread. If there is a transition from a global economy to local economy, it will not be a smooth transition. The edifice of laws and regulation are structured to facilitate globalization, rather than local production and manufacturing. Businesses and job markets would have difficulty switching up labor markets and supply chains.
Everyone who supported free markets 10 years ago, appears to have left the civilized world to live in isolated cabins in the woods. Maybe that is our most accurate indicator of free trade and free markets no longer having many supporters globally? The silent shift in public opinion has been deafening.
Will globalization make a return, TSMC's founder believes it will not. The concept of globalization was always dependent upon oil and one might say it wouldn't have survived past peak oil anyway.
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