The U.S. government plans to adjust tariffs on goods exported from Taiwan to 20%. Recently, Trump has reiterated this demand, reportedly hoping for TSMC to acquire nearly half of Intel's shares as a quid pro quo for tax reductions. This has raised significant concerns about the global chip supply chain and could potentially lead to risks of monopoly.
Multiple sources have revealed that the Trump administration is in negotiations with Taiwanese authorities regarding tariffs, emphasizing that Taiwan must offer substantial concessions to reduce the current 20% tariff to match the 15% rates of Japan and the EU. The report indicated that the U.S. has presented TSMC with two options: one involves directly acquiring 49% of Intel’s shares, while the other option entails Taiwan investing up to $400 billion in the United States.
The market generally believes that, considering the financial condition and cost considerations of Taiwanese companies, investing in Intel might be more attractive than making large-scale investments in the U.S. market. According to industry insiders in Taiwan, Intel has struggled with its operational performance in recent years, having laid off 15,000 employees in August 2024 and is expected to further reduce its workforce to 75,000 by the end of 2025, marking a decrease of over 25% from the figures at the end of 2024.
Currently, the U.S. government sees Intel as crucial for the reconstruction of the semiconductor supply chain, having approved billions of dollars in subsidies for the company. However, despite receiving this funding, Intel's competitiveness has not shown significant improvement. Analysis indicates that the Trump administration is aiming to leverage TSMC's funding and technology to reverse Intel's declining performance and maintain America's dominance in the advanced chip sector.
According to a seasoned observer from the tech industry, TSMC has been viewed as a strategic pawn for the U.S. since Trump's tenure began, and the recent tariff negotiations reaffirm this perspective. However, internally, there seems to be a lack of optimism regarding this plan. Sources indicate that Chairman Wei Zhejia finds the conditions of acquiring nearly half of Intel's shares and reinvesting $400 billion hard to accept. Analysts point out that even the total investment from the EU into the U.S. has not reached such a magnitude, making it quite unusual for a single company to shoulder such significant political risks and financial pressures.
Semiconductor industry analyst Chen Huiming has warned that forcefully pushing mergers to meet political demands could sacrifice TSMC’s long-term development and pose a threat to Taiwan's overall industrial security. He highlighted that TSMC, as the leading enterprise in global foundry services, bears the dual responsibility of supporting Taiwan’s economy and national defense. If it loses its market dominance, the impact on the overall industrial foundation could be significant.
Media outlets have also highlighted that a merger between TSMC and Intel would face significant challenges, given the stark differences in their corporate cultures, management structures, and technological blueprints. A forced integration could increase the complexity of the entire chip supply chain and raise concerns about monopoly. The report suggests that the only viable solution is to allow TSMC to gain full control over Intel's management, but achieving this goal could take many years, possibly even decades.
Another key point is that Intel's wafer foundry business has recently shown signs of recovery. The company's latest announcement about the 18A process has entered the risk production phase, indicating that there is hope for its transformation plan. Additionally, the new CEO, Chen Liwu, mentioned that the focus will be on customized wafer foundry services in the future. This suggests that Intel is shifting from the traditional Integrated Device Manufacturer (IDM) model to a foundry-centric business strategy.
In the current landscape, regardless of whether the U.S. ultimately pushes forward with the plan for direct investment, TSMC must carefully weigh its own interests, Taiwan's industrial security, and the multiple pressures of international politics. In the short term, the likelihood of this proposal being realized remains low, but the discussions surrounding it will undoubtedly have a profound impact on semiconductor policies and corporate strategies across the Taiwan Strait and beyond.
