TSMC - would Morris Zhang change his mind

 

Is there still time for Zhang Zhongmou to change his mind and work with China, work with SMIC and challenge the American hegemony on chips? Or he has surrendered everything to the Americans, too late already?

When TSMC is uprooted, many supporting industries would go belly up unless they are needed and also uprooted to the US. There will be a vaccuum of sort in Taiwan, factories and land would be emptied. Many Taiwanese would be jobless.

The economy would be affected and the GDP would fall.

Temporary it looks like the Americans are the main winner. However, when the decoupling takes full effect, all the American based chip makers would only be selling to the American and European markets. The Chinese market would be closed to them. China would speed up in becoming self sufficient in chip making.

The American chip making industry would face a glut of chips with no one to sell to. China is the biggest consumer of chips, but would be no more.

In this chip war, it would be a clean divide and no more cross trading. All the American chip based manufacturers would have to downsize, cut jobs, cut capacities. What is the point of producing chips with no buyers, like Australian iron ore, wines, seafood, lobsters, without China absorbing the bulk of them, they could only sell retail.

Pity the chip manufacturers, the workers, and the farmers and fishermen in Australia. This is penny wise pound foolish. Like the stupid Europeans, heavily dependent on the Russians for cheap oil and gas and food and want to play punk with their main source of cheap supplies. Now feeling the pain.

The Americans would feel the pain very soon. TSMC would not need the capacity and the jobs. After a year or two, TSMC would have to retrench the workers and engineers they are recruiting now.

Someone said the American and European leaders are smart. Really? Fighting with the hands that feed them?

 

 Anonymous