Sounds like they’re delaying because their Exynos chip is wildly unpopular compared to Snapdragon and simply blaming it on the CHIPS Act as cover. They’re claiming it’s because they need this couple billion in subsidies while also claiming they plan to invest $200 billion here? Seems like Samsung should be able to cover the tab in the interim if they really wanted to build here. This bill is already signed into law so why wouldn’t they receive the funds at some point? Is this 1% of their total investment really that critical?
This is just like Walgreens and RiteAid claiming they have to close stores due to theft, only to later admit that was a complete fabrication.
Samsung fab is different from Samsung’s Exynos team
TSMC has also not received a cent. Their chairman got kicked a few weeks ago for being stupid enough to trust American promises of money.
TSMC can’t get their fab build because they think US workers should be receiving Chinese wages. Everyone is entitled to a share of the money of they build a US fab. Intel is already in the middle of building a completely new campus in Ohio even though they’ve had a terrible couple years financially and haven’t received their subsidies either. You’d think TSMC, the company that makes virtually every other companies chips, would be able to front a few billion on their own facility.
Would you rather it end up like Foxconn’s Wisconsin deal where the city demolishes an entire neighborhood of homes, kicks the residents out, and gives billions in subsidies only for them to scale back the plant and only hire a couple hundred people to build outdated products? These companies are already absolutely massive and can afford this stuff on their own. The subsidies are just supposed to be a small incentive for doing so, not their primary source of funding.
A fab can fabricate designs by others.
Even if it’s not due to Exynos, the rest of my comment holds true. These subsidies are just a drop in the bucket in terms of total cost. Samsung and it’s subsidiaries account for 1/5 of the GDP for the entire nation of South Korea while TSMC already produces leading edge chips for nearly every major manufacturer on the planet, including Intel. They have plenty of funds to begin production here in the US even if they have to wait a little longer for these subsidies.
How is the size of Samsung relative to South Korea’s GDP relevant? Apple is a bigger company and it wouldn’t open a factory in the US without subsidies.
Apples chips are made by TSMC and Samsungs size reflects how deep their pockets are. They aren’t holding back because they haven’t received 1% of funding from the US government.
Samsung isn’t a charity and Samsung Electronics has its own books independently from other companies in the chaebol. The US needs to give Samsung a reason to manufacture in the US. Make it attractive vs. all the other countries.
Samsung have made SoCs for Apple before and Apple does its own manufacturing and whatnot in the US that it does receive subsidies for.
Apple is amongst the companies that have received the biggest state and local subsidies in the U.S. It got US$891 million in 2021.
https://www.macobserver.com/analysis/apple-receive-subsidies-from-us-states/
For tech and media companies, much of the money went towards building R&D centers, relocations of corporate offices and office campuses in certain states.
Not all such payments are though well received. Back in December, a subsidy to Apple from North Carolina, where the company is building a new campus, was branded 2021’s “Worst Economic Development Deal of the Year” by the Center for Economic Accountability (CEA). The arrangement is worth over US$846 million. John Mozena, president of the CEA, said:
A billion dollars is a lot of money for North Carolina’s taxpayers and communities, because that’s a billion dollars’ worth of public services not being funded. But for a company like Apple, which reported more than a billion dollars a day in revenues this past year, it isn’t anywhere near enough money to move the needle on a major site selection decision.
Seems none of this went toward any sort of manufacturing capacity. Furthermore, the article mentions Samsung received $1.2B in subsidies already from state and local governments, roughly in line with what they’d be receiving from the CHIPS Act. Of course they’re not a charity, but how is 1% of funding holding back the entire project if they’re paying the other 99% out of their own pocket? As I said originally, this is just a convenient cover to deflect away from their own poor performance as a company and put the onus on the government.
As I said originally, this is just a convenient cover to deflect away from their own poor performance as a company and put the onus on the government.
Then explain TSMC doing the same. It is more believable that the subsidies aren’t enough to make manufacturing attractive and more needs to be done.
Samsung Electronics does not make up 20% of South Korea’s GDP lol
I never said they did, but as a corporation, they make up 20% of South Korea’s economy.
Samsung should be able to cover the tab in the interim if they really wanted to build here
That’s the whole point. Samsung and TSMC never wanted to build American plants due to their history of stealing IPs, but the US government strong-armed them into building them. The subsidies were meant to smooth things over but now it’s not being doled out.
This is just like Walgreens and RiteAid claiming they have to close stores due to theft, only to later admit that was a complete fabrication.
Thought this was interesting, so I tried looking for more information. Didn’t find anything other than people speculating. If you have a link or search terms I could use to find of an article of these or similar companies saying the closings were actually because of something else, I’d appreciate it.
I did, yes. The second link has the relevant quote from the CFO - “We’re probably – you know, maybe we cried too much last year when we were hitting numbers that were 3.5% of sales”.
Though looking at the context, it looks like he regrets the actions (specifically increased security hired) that came from that. There doesn’t seem to be anything about the link to store closures.
The actual link came from an article Shepard Pie below you provided here (Is Shoplifting Really Surging?). Apparently nationwide, shoplifting is down - except in certain cities
But the increase in shoplifting appears to be limited to a few cities, rather than being truly national. […] There are some exceptions, particularly New York City, where shoplifting has spiked.
Out of the 24 cities, 17 reported decreases in shoplifting.
I’m guessing the 7 remaining cities are where the stores were closed.
At this rate the global south will build up semiconductor fabrication before the US.
Never trust Americans to pay what they promised. This is a business lesson that you learn again and again in the real world.
At this point it would be cheaper, easier, and faster to demand the IP for developing chips and build a government ran fab. I’m calling it now, the companies will pretend to take the investment, break ground, and then declare the project impossible for free profit from a government.
Another Biden promise that clearly isn’t actually being delivered on
It’s less executive action and more pipeline issues.
The department related to approval for these things just hired 140 new employees that just got through on-boarding for this specific task. That 140 is literally the max Congress approved for handling applications in all tiers of the program, with a lot of Senators having hoped that somewhere around ½ that number would have been the final tally hired in.
Those new employees will then need to navigate the 50+ page applications for each bid. With something around 480 bids in the first CHIPs acceptance round. So around 180 people will need to digest as quickly as possible somewhere around 24,000+ pages of applications. That’s not counting any kind of objections that might have been filed by State, private citizen, and also competitors (Samsung and Intel have a few of these already on some of the first tier 1s already).
And all of this is just the first steps of the program that was written out by Congress. Congressional oversight, because remember all executive agencies established by law have Congressional oversight, has been really clear as mud on some of the finer details of this program. Biggest back and forth is the offshore but American funding, which holy crap I can’t write enough about how complicated that debate has become.
All of this is happening on the several step process that Congress prescribed for this whole thing. Because, tier 3 and tier 2 funding are good candidates for abuse of funding. Solyndra echos can almost be heard when mentioning this. Or more recent example of what could go wrong when you just open the flood gates, PPP loans.
Thing is, companies complain money isn’t coming fast enough all the time. The money could be on it’s way next week and they’d still complain that it wasn’t there on Monday. The more important thing is that the money isn’t being wasted too badly and that’s only happening with careful consideration. This is literally the exact same thing I said about Trump’s wall. One, I don’t think it would work anyway. Two, it’s ignoring a lot of commitments we have internationally. But three, if we’re going to do it, at least have a plan for properly spending the money which Trump did not because it basically took military funding and diverted it toward the wall, and thus it fell into one of those “you either spend it or lose it” and it meant that the construction had to be rushed and why a lot of “Trump’s wall” is mostly falling into the Rio Grande or made of metal slats that can easily be sawed through with a hand saw.
So sure, whatever, but the more important thing… Well let me clarify, the more important thing from my perspective, so totally cool if someone disagrees, is that the money is carefully spent wisely. It doesn’t have to be a homerun, I just would rather the money not be tossed all over the place like PPP was.
And I get some of the arguments for why PPP was done the way it was, but to put it to scale, I would prefer handing it out like a 3, I understand why people would want it handed out like a 7, but holy fuck we handed it out like a 9.3. Where 1 is being penny up the ass to make copper wire tight about the money and 10 is prolapsed colon flow of money out the ass. It was really indefensible how just loosey goosey we were with that money. And yes, there’s been other times we’ve done that (cough military cough), I didn’t like those either.
Same story with TSMC incidentally https://www.tomshardware.com/tech-industry/us-government-doles-out-paltry-dollar35-million-of-the-dollar52-billion-chips-act-warns-of-possible-delays-in-intel-and-tsmc-fab-buildouts
Seems like US isn’t actually able to fund fab reshoring. Meanwhile, China’s chip industry has exploded and China is now able to produce 5nm chips. The chip sanctions are backfiring on US in the most hilarious fashion.
Doubtful that Huawei’s 5nm chip is domestically-produced. Looks like old stock TSMC that Huawei no longer needs to stockpile because domestic capability is quickly becoming competitive with it.
Huawei’s chip was impressive, but not for the reasons you think.
It was based off an existing chip design originally intended for cryptocurrency mining and made using old fab technology that China still had access to post sanctions.
It was impressive because they did push the old fab technology to new levels, but also probably pretty close to its technical limitations.
There’s absolutely nothing doubtful about that. Pretty much everybody in the west now admits that China can make 5nm chips domestically.
