As the tariff war escalates and history revisits Japan’s semiconductor downfall, will TSMC be caught in the crossfire?
Original Article by SemiVision Research
TSMC founder Morris Chang has repeatedly stated that “globalization is dead, and free trade is dead,” highlighting the profound impact of rising geopolitical tensions and technological competition on the semiconductor industry. He emphasized that the end of globalization signifies a shift in supply chain priorities—from cost and efficiency to national security and political interest. This transition is expected to increase chip manufacturing costs and slow down the pace of semiconductor adoption, while also placing TSMC at the center of global strategic rivalry.
Chang has warned that countries like the United States, under the banner of “national security,” are reshoring manufacturing and restricting technology exports, directly challenging the foundation of the semiconductor industry that was once built on free and open trade. In such an environment, he believes the industry must fundamentally rethink its approach to competition and collaboration.
As globalization recedes, governments around the world are accelerating efforts to localize and secure their semiconductor supply chains. The concept of semiconductor self-sufficiency has become a strategic imperative, with nations investing heavily to reduce external dependencies and assert control over critical technologies and manufacturing capacity.
In response to these challenges, TSMC has adopted a global expansion strategy, establishing advanced fabs in Arizona, USA, and Kumamoto, Japan, to mitigate geopolitical risks and meet localized demands from customers and governments. Despite the increasingly complex landscape, Chang remains confident in TSMC’s technical leadership and execution capabilities, believing the company can maintain its competitive edge in this new world order.
United States：“Rebuilding Silicon Sovereignty — Innovate, Secure, Lead.”
European Union:“Chips for Europe — Resilience Through Unity and Innovation.”
Japan: “Back to the Core — Reviving Japan’s Semiconductor Spirit.”
South Korea:“From Memory to Mastery — Leading the Next Generation of Semiconductors.”
China:“Self-Reliance in Silicon — Building a Strong and Independent Chip Ecosystem.”
India:“Make in India, Chip for the World — Rising Through Design and Manufacturing.”
TSMC, Intel and peers to slow Japan, Malaysia chip expansions- Nikkei
Recently, U.S. President Donald Trump revealed during a public event that he had told Taiwan Semiconductor Manufacturing Company (TSMC) it would face a 100% tariff if it did not build a factory in the United States. This statement has drawn widespread attention, particularly concerning the global semiconductor supply chain and U.S.-Taiwan trade relations.
At a dinner hosted by the National Republican Congressional Committee, Trump stated that he warned TSMC it would be subject to steep tariffs unless it established production facilities in the U.S. This move was aimed at reshoring manufacturing and reducing reliance on foreign supply chains.
TSMC had previously announced plans to invest up to $100 billion in Arizona, with the goal of building five chip manufacturing facilities. However, Trump criticized the Biden administration’s decision to provide $6.6 billion in subsidies to the company, arguing that semiconductor firms do not need such financial support.
In addition, the Trump administration recently implemented new tariff policies targeting multiple countries, including Taiwan. While a 32% tariff was imposed on a broad range of Taiwanese imports, semiconductor products were temporarily exempted. These measures, however, could still impact Taiwan’s exports and broader economy.
Overall, Trump’s tariff threats toward TSMC, along with the broader trade policy shifts, reflect a strategic effort by the U.S. to reshape global supply chains and bring manufacturing back onshore. These moves present new challenges and tests for the global semiconductor industry and the economic policies of key partner nations.
President Donald Trump’s tariff policy on the semiconductor industry bears certain similarities to the trade restrictions imposed by the United States on Japan’s semiconductor sector in the 1980s. However, there are also clear differences between the two approaches. For a deeper understanding of the historical context and policy background of that era, you may refer to the following articles.
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SemiVision will discuss the following topics :
U.S.-Japan Semiconductor Trade Conflict, Causes of Industry Decline, and Whether TSMC Could Be Caught in the Semiconductor Tariff Crossfire
Policy and International Pressure: Short-Term Protection, Long-Term Risk
Corporate Strategy and Industry Structure: Missing the Shift Toward Vertical Specialization
Japan's New Direction in the Semiconductor Industry in the 2020s
TSMC Collaboration: Advanced Manufacturing and Packaging
The Rapidus Initiative: Japan’s Bid for 2nm Leadership
Conclusion: A New Turning Point for Japan’s Semiconductor Industry
