News of TSMC getting a huge chip order from Tesla first broke in November this year. It was reported that the Taiwanese company will supply 4nm and 5nm chips for the latter’s Full Self-Driving (FSD) AI. DigiTimes Asia has now confirmed those reports, adding that TSMC will begin volume production of this order in 2024. As suggested by earlier reports, the first batch of supply may still reach Tesla next year. That depends on when the factory becomes operational, though. TSMC began the construction of its first chip fabrication facility, aka fab, in the US last year with plans to start churning out semiconductors by 2024. The building was ready in no time but the company still has to complete the installation of manufacturing equipment. Semiconductor manufacturing sites require clean rooms that must be extremely… clean. Meanwhile, TSMC has already announced plans to construct a second chip plant in Arizona. It will be operational by 2026.
TSMC getting this 4nm chip order from Tesla is a big loss for Samsung
This deal would make Tesla one of TSMC’s seven biggest clients, and the first EV client. And it’s a big loss for Samsung. The Korean company has found it tough to go neck-on-neck with its Taiwanese rival in the foundry sector. Well, it is way behind TSMC, with recent reports showing a market share of 15.5% and 56.1%, respectively. This kind of chip order may have helped Samsung close the gap in the coming years but it has lost out on the opportunity. What makes this deal between Tesla and TSMC even more painful for Samsung is that the EV company has been sourcing chips for its FSD AI from it until recently. The Korean behemoth initially supplied 14nm chips to the Elon Musk company before upgrading to 7nm. But Tesla has now decided to go with TSMC for more advanced solutions. Even Apple plans to buy chips from TSMC’s Arizona fab. The iPhone maker will source 3nm processors from the Taiwanese company. As for Samsung, it will now have to be content with being the exclusive supplier of camera modules for Tesla’s electric cars. Samsung cameras will be fitted in everything from the Cybertruck to the relatively new Semi truck.
