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Trump would have been known for all the wrong reasons the world over, but he did well to focus on US semiconductor production. TSMC, the world’s foundry opened a chip manufacturing plant in Phoenix, Arizona, which is likely to start production as early as 2024. Now as reported Apple and TSMC are in talks to bring 3nm chip production to the US. As in known lower process nodes drive more transistors on the SoC, more power and more operations are the end result. As Samsung’s 4 nm process node causes chip to heat and company decided to it a go by and the demand shifted to TSMC. Next year, TSMC will start production of 3nm A 17 Bionic for the 15 Pro and iPhone 15 nmUltra.

The Apple chip journey has been very fascinating given the continuous upgrade they keep aiming for. The iPhone 11 came with Apple A 13 Bionic, using a 7nm process by TSMC. In 2019, 8.5 billion transistors made all the uses. iPhone 14 Pro model has A16 Bionic with the TSMC’s enhanced 5nm process, with 16 billion transistors on a single chip. May 2021 IBM announced a 2 nm chip, meaning that it would ”fit 50 billion transistors in a space roughly the size of a fingernail.” Apple and TSMC has been working together for a long time and 25% of TSMC’s revenue comes from Apple.

Though Apple wants to shift its chip production from China. Given the nature of the project it is not going to happen in a jiffy. Some analysts are of the opinion that it would take at least 8 years to transfer iPhone production from China to India. The US restrictions have forced China to move in the self-reliant mode. To subserve its interests in this field China might just ”swallow” Taiwan. On the other side of the semiconductor geo-strategic story, the Phoenix plant is waiting for the 5nm chips to be withdrawn from the market. This would be the right to time to move 3nm production to the US. Necessarily, they will have to bring top talent to US.

The famed journey of the chip to the US will not be fairly tale story as it is made out to be. The China ecosystem and supply chain, where logistics work seamlessly, would be difficult to replicate. The challenge is very simple if TSMC decides to start making chips in the US, they would be cut from the supply chain. As being talked about the Arizona factory could open for business in 2025. Apple and other companies will have to move onto to 2nm chips by that time. As per the current calculations iPhone 17 will use this process node. If Apple will still differentiate the chips used in non-Pro and Pro models, then by 2025, the iPhone 17 models might use chips made in the US.

Sanjay Sahay

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