The Wall Street Journal reports that the Trump administration is discussing with chipmakers like TSMC (Taiwan Semiconductor) and Intel about the possibility of building manufacturing facilities in the United States.
TSMC manufactures the core system-on-a-chip silicon that Apple relies on for its iOS devices (and soon for Macs too). The upcoming A14 chip, which will be introduced in the iPhone 12, is based on a 5-nanometer process. This manufacturing is currently taking place in China, but the US government is committed to getting these companies to start producing domestic chips.
According to the report, government trade officials are holding meetings between TSMC and Apple in hopes of building a US chip factory. While this would probably not be enough to meet Apple’s global supply needs, it could impact and help the US economy.
Before his presidency, Trump used Apple to make iPhones in the United States. Apple always replies that the components that make up the iPhone are made all over the world and the focus is on final assembly. This last step is the point in the process at which all components are assembled into the end devices. This is mainly done at the Pegatron and Foxconn factories in China.
When asked if assembly should be returned to the U.S., Apple CEO Tim Cook said the lack of infrastructure and mass work was an obstacle. Foxconn alone employs hundreds of thousands of people who work on iPhone factory lines every day – with long hours and relatively low wages.
However, since chip manufacturing is largely automated machine work, labor supply issues are less important. There are still infrastructure problems, but the journal reports that the administration is investigating various methods to subsidize start-up costs.