TSMC slashes its budget, is the future of semiconductors more grim than imagined?

Source: Content from "technews", thank you.

Affected by the Sino-US trade war and the slowdown in smartphone sales, TSMC is said to believe that the economy may be poor in 2019 and has decided to tighten its belt. Not only has the business cars of executives been downgraded, but the number of business trips by employees has also been reduced.

The English version of Nikkei Shimbun reported on the 6th, citing sources familiar with the matter, that TSMC has asked vice president-level executives to change their leased business vehicles from luxury Mercedes-Benz cars to mid-range Toyota Camrys, and has also become increasingly strict in reviewing applications to participate in trade shows and international conferences. Reducing unnecessary expenses is the top priority.

According to internal analysis, this austerity measure is the most severe one TSMC has taken in the past 10 years, even more severe than the one in 2009 when the global financial crisis broke out. It is said that TSMC has been implementing austerity measures since the middle of this year, which reflects the company's pessimistic view of this quarter and next year. The slowdown in the growth of the smartphone and semiconductor industries and the uncertainty of the Sino-US trade war are the main reasons for TSMC's action.

TSMC spokesperson Elizabeth Sun confirmed that the company has adopted a stricter review policy for employees' international business travel applications and has also replaced the car rental plan for vice presidents. However, the policy of strictly reviewing travel expenses has been implemented for more than a year.

TSMC is the exclusive supplier of the iPhone's core processors. It also manufactures chips for major semiconductor companies such as Qualcomm, Nvidia, NXP, Broadcom, MediaTek, and Huawei's HiSilicon Semiconductor. It is regarded as an important leading indicator of the global electronics industry's prosperity.

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