- Kyle Chua
Apple Reportedly Plans To Start Sourcing Chips Made in US, Europe by 2024
Apple reportedly plans to pivot from Asia as it prepares to start sourcing chips manufactured in the U.S. and Europe within the next couple of years, according to Bloomberg.
The Cupertino tech giant has already purchased a plant in Arizona to take away some of the supply chain load off of Taiwan, as CEO Tim Cook disclosed during an internal meeting in Germany.
“We’ve already made a decision to be buying out of a plant in Arizona, and this plant in Arizona starts up in ’24, so we’ve got about two years ahead of us on that one, maybe a little less,” Cook told local engineers and retailers who were at the meeting.
“And in Europe, I’m sure that we will also source from Europe as those plans become more apparent,” he added.
Cook is likely referring to the plant outside of Phoenix that will be run by Taiwan Semiconductor Manufacturing Co. (TSMC). The plant, which is estimated to be worth US$12 billion, is still under construction right now but expects to be operational by 2024, lining up with the tech executive's timeline. TSMC is the exclusive chip-manufacturing partner of Apple, supplying it with the A-series and M-series processors that power iPhones, iPads and Macs.
The chipmaker's Arizona plant will adopt the five-nanometre process and have an initial capacity of 20,000 chips a month – a relatively small number compared to the plant in Taiwan, which has a capacity that exceeds a million a month. However, there are plans to build more fabs and expand capacity down the line.
Apple plans to adopt TSMC's new three-nanometre chipmaking process for future releases. The supposed A17 chip which will ship with next year's iPhones will be manufactured in this new process, though it's unclear as of yet whether it will be made in the Arizona plant or elsewhere.
The U.S. government's Chips and Science Act has paved the way for TSMC and other major chipmakers to open plants in the country, with over US$50 billion in incentives to be enjoyed. Previously, the iPhone maker sourced processors from TSMC plants in Taiwan where 60% of the world's chip supply comes from. Cook pointed this out during the meeting, commenting, “regardless of what you may feel and think, 60 per cent coming out of anywhere is probably not a strategic position". This could, of course, change once Apple starts sourcing its chips from the U.S. and Europe.
Apple reportedly plans to pivot from Asia as it prepares to start sourcing chips from the U.S. and Europe by 2024.
CEO Tim Cook said the Cupertino tech giant is buying out a chip-manufacturing plant in Arizona to take some of the supply chain load off of Taiwan.
The plant he's likely referring to is the same one that'll be run by TSMC, the sole chip supplier of Apple.