In the global semiconductor industry landscape, the formation of foundry locations (chip trial production bases) as places of origin is the result of multiple historical factors and current conditions intertwining.
This article will systematically analyze the deep-seated motivations for regions such as Taiwan, South Korea, and the United States becoming core foundry bases from the perspectives of technological development paths, industrial chain restructuring, and geopolitical games, and explore the new challenges under the trend of global supply chain restructuring.
1. Evolution of Technological Diffusion Paths and Industrial Division of Labor Models
(1) Breakthrough Changes in the Vertical Integration Model
In 1987, TSMC pioneered the professional foundry model, breaking the vertical monopoly of IDM (Integrated Device Manufacturing) manufacturers.
This model innovation allowed Taiwan to gain a technological entry ticket: by undertaking process transfers from American and Japanese companies, TSMC established a technological gap during the 0.35μm process era.
The success of the foundry model lies in dispersing capital expenditure risks across the customer base, forming a positive cycle of “process R&D – customer design – mass production verification.”
(2) Symbiotic Relationship Between Equipment Vendors and Foundries
ASML’s EUV lithography machine research and development investment has reached 9 billion euros, and its technology roadmap is deeply tied to TSMC’s process requirements. This symbiotic relationship creates a technological entry barrier: Samsung had to accept equity investment from ASML to gain priority supply rights for EUV equipment.
Foundries create process know-how through customized equipment modifications, making the cost of technology transfer far exceed the cost of equipment acquisition.
(3) The Multiplier Effect of Talent Aggregation
The semiconductor talent density in Hsinchu Science Park reaches 1,500 engineers per square kilometer, forming a rare global “24-hour R&D cycle.”
Microelectronics majors at universities such as National Tsing Hua University and National Chiao Tung University implement a “3+1” school-enterprise joint training model, directing 3,000 process engineers each year. This accumulation of human capital requires over 20 years of continuous investment, forming a competitive barrier that is difficult to replicate.
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2. Capacity Layout from the Perspective of Geopolitical Economics
(1) The Struggle for Discourse Power Over Technical Standards
The United States controls the export of equipment below 14nm to China through the Wassenaar Arrangement, effectively restructuring the technical standard system.
TSMC’s construction of a 5nm wafer fab in Arizona essentially packages the output of technical standards as a transfer of capacity. This “technology-geopolitical” bundling strategy makes the choice of foundry locations a tool of political games.
(2) The Cost of Restructuring Supply Chain Resilience
The chip shortage crisis exposed by the pandemic has prompted countries to reassess the risks of “just-in-time” supply chains. The EU Chip Act requires that by 2030, domestic capacity must account for 20%, which means 15 new 12-inch wafer fabs need to be built.
However, the relocation of foundry bases faces three paradoxes: equipment validation cycles extend by 30%, talent shortages reach 40%, and electricity costs rise by 25%.
(3) New Forms of Technological Nationalism
The South Korean government has designated semiconductors as a “core national technology” and implemented a combination policy of 10 years of tax exemption and 30% subsidies.
This model of state capitalism has given rise to Samsung’s “reverse engineering + massive investment” strategy: investing $23 billion in the 3D NAND field, squeezing competitors’ profit margins through overcapacity, and achieving technological catch-up.
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3. Bottlenecks in Technological Evolution and New Competitive Landscapes
(1) Innovation Path Divergence Under Physical Limits
As the process enters the 3nm node, quantum tunneling effects render traditional FinFET structures ineffective. TSMC has chosen the GAA transistor architecture, while Intel bets on RibbonFET technology; this divergence in technological routes forces foundry bases to modify dedicated production lines.
Each generation of technology iteration requires rebuilding 50% of production facilities, resulting in a “technological generational lock-in” characteristic in capacity layout.
(2) Value Chain Restructuring Brought by Heterogeneous Integration
Chiplet technology shifts chip design from a single die to multi-chip combinations, disrupting traditional foundry models.
TSMC’s 3DFabric alliance gathers 20 EDA vendors and 15 packaging and testing companies, forming a new ecological system. The competitive dimension of foundry locations has shifted from single process leadership to system-level integration capabilities.
(3) The Technological Politicization of Green Manufacturing
The EU’s Carbon Border Adjustment Mechanism (CBAM) imposes a carbon tax of 90 euros per ton on semiconductor production, increasing the carbon footprint of 12-inch wafer fabs by 18%.
TSMC is building the world’s first zero-waste wafer fab in Tainan, reducing electricity consumption by 30% through an AI energy management system. These environmental standards are evolving into new forms of technical trade barriers.
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4. The Butterfly Effect of Global Supply Chain Restructuring
(1) The Risk of “De-Asianization” in the Equipment Supply Chain
Applied Materials is building the world’s largest equipment R&D center in Texas, intending to restructure the geographical distribution of the supply chain.
However, key components still rely on Shin-Etsu Chemical’s ceramic seals (which account for 35% of equipment costs), and this deeply nested supply chain means that any regional adjustment will trigger cost fluctuations of over 30%.
(2) The Technological Visualization of Digital Sovereignty
China has launched the “East Data West Computing” project, which essentially couples computing infrastructure with a strategy for chip autonomy.
Yangtze Memory Technologies has made breakthroughs in 128-layer 3D NAND chips, causing the flow of storage chip foundries to begin shifting towards Wuhan. This trend of technological sovereignty is reshaping the global foundry landscape.
(3) The Innovation Race in a Technological Cold War
New US export control regulations will limit the manufacturing of AI chips with computing power exceeding 4800 TOPS, which in turn stimulates China to invest $15 billion in research and development in the photonic chip sector.
The Shanghai silicon photonic pilot line has achieved 800G optical module foundry, and this technological leap may disrupt the competitive advantages of traditional foundry bases.
The landscape of foundry locations is essentially a projection of technological power in geographical space.
As Moore’s Law approaches physical limits, industrial competition is shifting from a process arms race to the ability to build ecosystems.
The future foundry centers must possess the capabilities of technological sourcing, policy adaptation, and capital mobilization simultaneously. Regions that can deeply couple engineering capabilities with geopolitical strategies will hold the discourse power to define technical standards in the new industrial revolution.
This evolution indicates that the global semiconductor industry will enter a new era of coexistence between “technological sovereignty” and “innovation globalization.”