Does anyone have any insight on how they make it economically viable?
US salaries are astronomically high compared to the rest of the world. In the tech sector that's doubly so. Everything is incredibly expensive there. Is this basically a small facility to keep some politicians happy?
Or is it used to provide some supply military gear at 50x the price?
Will it get shut down in a few years once everyone forgets about it?
Intel has a fab a few miles away, and setting aside Intel's challenges, they're producing chips just fine. Semiconductor production is massively automated and the wafers are ludicrously high revenue/margin products. This isn't like using US labor to stitch t-shirts.
US Workers while costing more do seem are still competitive at expensive high value tasks. There was some reports a year back where the TSMC labs in Arizona while employee costs were higher also had 4% higher yield [1].
I'd wager combining that with US defense contracts for US made chips would be lucrative for NVidia.
is it high value? I know a guy working at a fab in Taiwan and he makes peanuts ($2-3K a month?). It's basically a factory job. From what he said it sounded braindead. TSMC is known for overpaying and having PhDs stare at assembly lines though - so I dunno.
Some hardware any superpower should be able to produce on home soil almost no matter the cost. That's why even Russia keeps domestic fabs making chips at some ancient process node - not to sell them for profit, but to maintain an ability to produce chips for the military and their own economy should things go down as they say.
Salaries aren't a huge part of manufacturing like people think. Once the factory is built, accounting for logistics of shipping and remote management, it's not a huge difference financially.
Getting the factory built, however, takes significantly more time and costs more in both actual dollars but, more importantly, the opportunity cost lost to not producing products in that extra build time.
Just print more money, it's a matter of national security. If the US is in a distrustful state, it's a good investment for the government, military or non-military (e.g. global trade getting more expensive for various reasons).
Well yeah, but the current administration hates the prior administration and loves having its ass kissed.
If they credited Biden, they would get their funding pulled, and possibly some ICE folks to black bag employees on their way in to let the courts sort out later.
Or they blow hot air up Trump's butt and make him feel like a big man and they get more funding without getting harrassed.
The EU was funding fab lines, several levels back up the chain IIRC? The idea being that the chips doing car comms, engine management, cruder FPGA, old ARM cores, can be done fast, and stop supply chain weaknesses for things Europe needs chips in, like cars (and tanks, and UAVs and ...)
I'm not saying tiny lines aren't cool. I'm just saying the idea you can't be successful if you make cruder, older resolution chips is probably wrong: Your printer and your car don't care if the Dice is 10mm not 5mm, and the track lines are 5x wider. MILSPEC stuff probably runs cruder for other reasons. Resiliency? Verilog proofs?
I also have no idea how many dice you get off a single ingot these days. 300mm wide, but how long?
What other options are there for Nvidia? EU as a whole is largely non-viable due to the schizophrenic nature of EU regulations. AI development has been made de-facto illegal in EU, auto industry is being ran to the ground, so there are hardly any customers for GPU's. Now mainland China certainly would be an interesting option, but State Department would throw a shitfit.
The problem they are alluding to is environmental regulations - it's outright impossible or very very expensive to do certain manufacturing processes, especially silicon and medicine, due to the substances involved. And that is valid for both the US and EU actually, there's a reason Silicon Valley is the densest concentration of Superfund sites in the US, and there is a reason why most of SV production has left for China and Taiwan.
An additional problem is, both the US and EU have been pretty happy to just ship off the environmental damage to Asia to the tune of "out of sight out of mind". We got cheaper products (especially in medicine, our healthcare systems would outright collapse if it weren't for Chinese and Indian generics and precursors), but the total amount of environmental damage in the world hasn't shrunk, it has grown.
You can't pack up a chemical factory and ship it overseas in a matter of weeks... in any case, BASF has let go hundreds of people last year and shut down part of said plant [1], partially due to staff cost but also due to a move to China planned to be finalized in 2030 [2]. They're aiming for 50% of gross income to come from China... utter madness if you ask me.
I mean, like having to hire hundreds of lawyers and assessors to just MAYBE get a construction permit within 2 or 3 years, if you want to build a gigafactory. Or any factory for that matter.
Most of the monopolies in the GPU supply chain (ASML, Zeiss etc.) are European companies. The “EU has no AI” narrative is mostly pushed by VCs so they can keep raising funds from European investors.
Just adding to the other commenters pointing out the unstable genius:
What do you think would have been the reaction of the angry TACO-lord if NVIDIA had announced that they're investing in the EU and not the US?
We know by now how weak his self-esteem is. He'd probably send some ICE agents in there and stopped all government contracts or something stupid like that.
At this point, decisions in this mafia country are not following (economical) logic anymore. It's utter, unstable madness.
Wow. This is a big deal. I had placed a bet that this will never work out and the folks on the ground thought the same too. This probably is going to be the lasting legacy of Biden administration.
Background: The CHIPS and Science Act, which is the key legislation behind the major incentives and on-shoring of semiconductor manufacturing in general and this achievement specifically, was signed into law by Biden on August 9, 2022.
It is a few generations behind: Blackwell is still on N4, which is an N5 variant. Meanwhile TSMC has been shipping N3 family processes in large volume products (Apple) for more than 2 years already, and is starting to ramp the next major node family (N2) for Apple et al. next year.
NVIDIA has often lagged on process, since they drive such large dies, but having the first major project demo wafer on N4 now is literally 2 generations behind Taiwan.
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