this post was submitted on 28 Jan 2025
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No choice except the obvious: Pass the cost of the Tax into the customer because there’s no way they’re going to spend billions to stand up a US fab plant anytime soon.
TSMC is standing up fabs in the US, mostly because we're bribing them to do so.
The problem is that it takes literal years to build high tech manufacturing and isn't something you can yank out of your ass to satisfy some idiot politician.
By Taiwanese law, TSMC isn't allowed to move cutting edge processes to its US plant. The overseas operations have to be at least one gen behind.
From a strategic point of view, it makes sense for the Taiwan government to do this. They don't want the US to suck them dry then cut a deal with the mainland.
I mean, it's economic blackmail: we won't build the good shit anywhere else, so if you don't protect us, you get nothing.
Effective, but only if you're dealing with someone who is rational, and, well, have you seen the brain-worm oligarchs in charge of the US lately?
More so when these plants take 10 years to build. They will pass along the cost and just wait him out.
That's just how tariffs work. They're not a weapon against enemy nations. They're a tax on Americans.
And nobody is going to bring production back to this fascist slave pen of a country.
Also, because these investments are long-term when the tariffs are likely to only be short term.
Yeah but what corporation is going to think of the obvious solution?