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Apple Hardware

Apple Plans To Source Chips From Arizona Plant In 2024 (cnbc.com) 39

Posted by BeauHD from the what-to-expect dept.
Apple will buy some of its chips from a factory in Arizona, Apple CEO Tim Cook said last month at an internal company meeting in Germany, according to Bloomberg News. CNBC reports: Apple currently sources all of its processors from factories in Taiwan. It designs its own chips and Taiwan Semiconductor Manufacturing Company manufactures the A-series and M-series processors that power iPhones and Mac computers. If Apple were to buy processors manufactured in the U.S., it would represent a significant diversification in Apple's supply chain away from Taiwan.

"We've already made a decision to be buying out of a plant in Arizona, and this plant in Arizona starts up in '24, so we've got about two years ahead of us on that one, maybe a little less," Cook said, according to Bloomberg. TSMC previously announced plans for a single factory in Arizona to open in 2024 focusing on chips that use the latest manufacturing technology. TSMC said earlier this month that it is planning a second chip factory in Arizona because of "strong customer demand."
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Apple Plans To Source Chips From Arizona Plant In 2024 More

Apple Plans To Source Chips From Arizona Plant In 2024

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  • I'd expect TSMC to schedule where parts get built. Customer submits a RFQ and TSMC provides a quote. And besides, Apple is just assuming the plant will be functional in 2024 and the process is the one they need. Both are anything but certain. TSMC may change its plan as to what process it runs in AZ and certainly anyone familiar with fab building knows stuff happens and delays can be lengthy.

    • Re: (Score:3)

      by tlhIngan ( 30335 )

      I'd expect TSMC to schedule where parts get built. Customer submits a RFQ and TSMC provides a quote. And besides, Apple is just assuming the plant will be functional in 2024 and the process is the one they need. Both are anything but certain. TSMC may change its plan as to what process it runs in AZ and certainly anyone familiar with fab building knows stuff happens and delays can be lengthy.

      If you're a fabless small company using TSMC, you're right, TSMC will schedule where and when your chip gets produced

      • Re: (Score:3)

        by skegg ( 666571 )

        I can't help but feel every time additional chip manufacturing is moved away from Taiwan, that's one less reason for the West to care when China threatens to "re-unite".

        Right now much of our (Western) industries would suffer if hi-tech fabrication suddenly came under Chinese control. Hence all the chest-beating when China fired those missiles. But if / when the bulk of hi-tech chip fabrication is happening elsewhere (US, India, etc) I suspect the West will just shrug.

        Thoughts?

    • I doubt the chips Apple orders will only be produced in one factory. So they could be produced in the Arizona factory - in addition to several other factories. But at the very least, prototype production could occur in Arizona. It would keep prototype parts more secure and make for faster transport to California. But the real purpose for the Arizona factory must be military components as they typically come with a "must be made in America" requirement.

      • Not exactly. Phoenix is prime real-estate for semiconductor fabrication. Has been for a very long time. Highly stable political climate, highly stable plate tectonics, highly stable weather patterns, very robust public infrastructure with highly reliable electrical grid and other utilities, relatively low crime rate, strongly diversified economy, and a highly skilled workforce.

        If you don't mind a bit of hot air in the summer, there's no reason not to.

        Though I'm pretty sure all of the big California city gov

      • But the real purpose for the Arizona factory must be military components as they typically come with a "must be made in America" requirement.

        Well yeah, if you completely ignore growing threats to Taiwan from China, along with an increased need to be self-sufficient within your own borders driven by a pandemic that decimated the international supply chain for the last 24 months, sure.

        No. I don't think it "must" be military...

      • I agree parts may be made anywhere. Everyone has ignored one of my primary points, the fab may not be up in 2024. It is not exactly like they are baking chocolate chip cookies. Yes they have lines running elsewhere, but every line is slightly different and the new one in AZ could have a glitch in the build. As to prototypes, doubt it makes that much difference. It takes I think 2 months now to run a part. An airplane will have it delivered in less than 12 hours from anywhere. And I think everyone is forgett

    • I'd expect TSMC to schedule where parts get built.

      If TSMC is building a plant in Arizona, I'd expect them to be rather efficient and sell to their American customers out of there. It's kind of the entire point.

      Customer submits a RFQ and TSMC provides a quote. And besides, Apple is just assuming the plant will be functional in 2024 and the process is the one they need. Both are anything but certain. TSMC may change its plan as to what process it runs in AZ and certainly anyone familiar with fab building knows stuff happens and delays can be lengthy.

      You act as if that "customer" is some guy out of Tempe waiting on two dozen chips for his patented smart fruit basket. This is Apple we're tallking about. Key customer would be the understatement of the decade.

      If I were TSMC, I'd have negotiated prepayments to ensure I have dedicated fab lines in the plan for that guy named Tim. And if I were Ap

    • I'd expect TSMC to schedule where parts get built. Customer submits a RFQ and TSMC provides a quote. And besides, Apple is just assuming the plant will be functional in 2024 and the process is the one they need. Both are anything but certain. TSMC may change its plan as to what process it runs in AZ and certainly anyone familiar with fab building knows stuff happens and delays can be lengthy.

      Normally, yes.

      But as far as a TSMC Customer, Apple is large enough to "Make their own Weather". Apple buys entire year's worth of TSMC Production Scheduling. To posit that they don't know exactly what is going on with this plant in Arizona is beyond silly.

      • While Apple is certainly a big customer they aren't that big. TSMC does about 12 million (300mm/12 inch) wafer starts a year. If I plug in the die size of the M2, the number of iphones and macs sold I get less than quarter of a million wafers are needed for apple. I doubt if this is low by more than a factor or 4 or so. I remember hearing from some guy at IBM back in the PowerPC days that Apple was a very annoying customer that accounted for about 10% of their fab and that the guys in the trenches were ha

        • While Apple is certainly a big customer they aren't that big. TSMC does about 12 million (300mm/12 inch) wafer starts a year. If I plug in the die size of the M2, the number of iphones and macs sold I get less than quarter of a million wafers are needed for apple. I doubt if this is low by more than a factor or 4 or so. I remember hearing from some guy at IBM back in the PowerPC days that Apple was a very annoying customer that accounted for about 10% of their fab and that the guys in the trenches were happy to seem them switch to Intel. I wonder if TSMC feels the same way.

          Actually, I heard it was 0.5% of IBM's fab; but that was a long time ago, and a much smaller Apple.

          First, your "Die Starts / nanoacres" calculation is waaaaaay overly simplistic, and appears to be based upon a 100% Yield; which is laughable, particularly at the complexity-level of Apple's SoCs. It is also based on a non-published guess as to number of units sold.

          Guesses based on Guesses. Right. . .

          I submit that, perhaps in the aggregate, Apple doesn't consume as much of TSMC's Capacity as all other Customer

        • While Apple may not be the largest volume customer, Apple has wanted to pay more for TSMC's newest fabs. As history has shown Apple has helped to partially fund these new fabs for the privilege of preferential treatment. As for IBM, that was slightly different as IBM was both designing and fabricating the chip. I guess for him Apple must have seem annoying as they needed annual upgrades in both design and fabrication which almost none of IBM's customers needed. Their other customers tend to make the same ch
          • For all I know Apple may be their largest single customer, and I bet you are right about the nature of Apple's and TSMC's relationship. Of course at this point where else is Apple going to go (unless they build their own fabs).

            My comment was meant as a reaction to "Apple buys entire year's worth of TSMC Production Scheduling" - which I took as meaning 100% of their production. If my obviously simple-minded estimate of Si area (which does have > 50% area wastage built it) is low by a factor of 10,
            • That sentence would be more correct if they added at the end "for their first [node] fab". For example Apple certainly took up almost all of TSMC’s first 7nm fab production for a year; however, TSMC later added more 7nm fabs and later 5nm fabs and is working on 3nm.
      • There can be any number of factors that could cause delays in the AZ plant not coming up. I've no doubt Apple is being kept updated, but even TSMC doesn't know if they are going to hit a snag. Ask Intel how hard things get at these dimensions.

        • There can be any number of factors that could cause delays in the AZ plant not coming up. I've no doubt Apple is being kept updated, but even TSMC doesn't know if they are going to hit a snag. Ask Intel how hard things get at these dimensions.

          And so. . .?

  • Good (Score:2)

    by slazzy ( 864185 )
    As World War III starts over Taiwan soon we'll need computer chips.

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