Apple is gearing up to source chips from a factory in the US within the next couple of years, according to Bloomberg's Mark Gurman. Company CEO Tim Cook reportedly made the revelation during a meeting with local engineering and retail employees in Germany, telling them that Apple "already made a decision to be buying out of a plant in Arizona." As Gurman notes, it would lessen Apple's reliance on factories in Asia, particularly Taiwan, where 60 percent of the world's processor is produced. "Regardless of what you may feel and think, 60 percent coming out of anywhere is probably not a strategic position," Cook added.
The CEO is most likely talking about Taiwan Semiconductor Manufacturing Co.'s Arizona plant, which is currently under construction. TSMC is Apple's exclusive chip-making partner, though it also counts NVIDIA, MediaTek, AMD and ARM as some of its customers. The Arizona plant is expected to start running in 2024, with an output of 20,000 chips a month and the ability to produce 5-nanometer processors.
According to previous reports, Apple plans to adopt TSMC's new 3-nanometer chipmaking process, which is its latest and most advanced yet, for future devices. The Financial Times says the A17 mobile processor Apple is currently developing for its 2023 iPhone lineup will be mass produced using the new technology. It's unclear if Apple only intends to use the Arizona plant for older and less sophisticated chips or if TSMC has plans to update the factory. TSMC is already thinking of building a second plant next to its $12 billion facility in Arizona, but it told Bloomberg that it hasn't made a final decision yet.
As the publication previously reported, TSMC has been expanding to other countries over the past year in an effort to meet the needs of customers in countries encouraging domestic semiconductor production. President Joe Biden, for instance, recently signed the CHIPS and Science Act into law. Under the new law, the US government is offering $52 billion in funding and incentives for firms building chips in the country.
In addition to revealing that Apple will start sourcing US-made processors, Cook also reportedly told staff members: "I’m sure that we will also source from Europe as those plans become more apparent." While that's all he shared at the meeting, Bloomberg previously reported that TSMC is in talks with the German government to open facilities in the country. Europe, like the US, also looking to entice semiconductor manufacturers to open plants in the region and introduced the EU Chips Act in April to "bolster [its] competitiveness and resilience in semiconductor technologies and applications."
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