Intel to build a wafer foundry in the United States? Analyst: The chances of success are slim

According to Jiwei.com, the US government is negotiating with Intel and TSMC to build factories in the United States to reduce its reliance on chip supply from mainland China, South Korea and Taiwan. In response, Intel said that it is discussing with the US Department of Defense to improve the domestic supply of microelectronics and related technologies. In addition, Intel is fully capable of cooperating with the US government to operate a commercial chip manufacturing plant and provide a wide range of secure microelectronic products.

However, semiconductor analysts have doubts about this. Christopher Danely, an analyst at Citi, believes that Intel's wafer foundry built in the United States has little chance of success. On the one hand, Intel's operating method is different from that of wafer foundries. Wafer foundries usually produce a variety of components in small batches and use flexible operating models to meet the different needs of customers, while Intel usually produces a small number of parts in large batches; on the other hand, Intel still needs to work hard on the technical level. Danely pointed out that the company still has problems with its 7nm and 10nm production lines.

However, Danely also pointed out that wafer foundry allows Intel to leverage its technological leadership and manufacturing experience, and is Intel's only growth opportunity.

In addition, Danely believes that TSMC is more likely to build a wafer foundry in the United States than Intel, mainly because TSMC has a large wafer foundry database, a diverse customer base, complete process technology, and first-class delivery quality, which can offset the disadvantages of setting up a factory in the United States, including the distance from its core business and suppliers in Taiwan.

Vivek Arya, an analyst at Bank of America Global Research, said that building any new foundry would take a long time and cost a lot of money. Arya believes that Intel has tried to enter the foundry industry several times but has never succeeded, and the company's recent process problems are not conducive to its market capture.

Arya also added that Intel and many manufacturers that rely on foundry are in competition, and these manufacturers are unlikely to sign contracts with Intel and use its foundries. In the long run, Arya believes that Intel may split its design and manufacturing divisions.