TSMC Dashes Apple-Azalea Hopes

Is Apple (NASDAQ:AAPL) building a multi-billion dollar, top-secret chip plant with the Taiwan Semiconductor Manufacturing Company (NYSE:TSM) in the United States? That is the rumor spreading through many technology publications, and given Apple’s intensifying courtroom battle with Samsung (SSNLF.PK), it would be logical for the company to want to reduce its dependence on the Korean electronics manufacturer that builds all of Apple’s custom A-series processors.

But although TSMC Chief Executive Morris Chang told the Taipei Times that the company would be building a new manufacturing plant, a project code-named Azalea, he denied that Apple was involved. “The US is one of the places under consideration,” Chang said. “But this has nothing to do with Apple.”

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While the plant would be right in line with comments Apple CEO Tim Cook made earlier in December about moving some manufacturing to the United States, Chang said that the increased production capabilities would be used to fulfill orders from Qualcomm (NASDAQ:QCOM) and Nvidia (NASDAQ:NVDA). Currently, TSMC can only make 68,000 12-inch wafers per month, and both semiconductor manufacturers have complained about the supply restraints. Furthermore, as the publication Cult of Mac noted, 68,000 chips are less than “one-two-hundredth of the number of processors Apple would need TSMC to make.”

However, this is not to say that Apple isn’t considering building a plant on domestic shores. After all, Cook did say in an interview with Bloomberg Businessweek that Apple would be bringing some production to the U.S. next year. “This doesn’t mean that Apple will do it ourselves, but we’ll be working with people and we’ll be investing our money,” he said.

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