How Taiwan's Semiconductor Industry Won

Taiwan's rise as a semiconductor powerhouse gave birth to companies like TSMC, who positioned the island as a critical player in global tech and electronics supply chains.

Brought to you by the Behind Asian Team.

[BehindAsia]

Do you think Taiwan will continue to lead the semiconductor industry?

[Skynetuser]

TSMC, UMC, Mediatek, ASE and many supply chain companies are the real hub of semiconductor industry located in Taiwan.🎉

[stujonny]

Taiwan # 1, the peace loving independent country ! Stop saying entire island, it is an country.

[mikslids]

Taiwan's Industrial and Overall Economic Strength.

Many people are unaware of the industrial and overall economic strength of Taiwan today.
Taiwan has a well-developed technology and manufacturing sector. It is ranked first in the world in semiconductor chip manufacturing, first in the world in ICT equipment manufacturing, third in the world in machinery and components manufacturing, third in the world in biotechnology companies, fourth in the world in machine tools, sixth in the world in chemical plants, and fifth in the world in shipbuilding tonnage. Taiwan's aerospace industry is also ranked sixth in the world in terms of output. Taiwan is also the world's largest and most technologically advanced carbon fiber composite material OEM, with applications ranging from tennis rackets and bicycles to aircraft components.
Taiwan has many companies that are hidden champions in the global manufacturing sector. These companies are at the top of their respective industries, but they are not well-known to the general public. Taiwan has developed its own supercomputers, AI computers, quantum chips, satellites, and has successfully test-fired military space rockets on multiple occasions.
In terms of overall technology and manufacturing strength, Taiwan is on par with the United States, Japan, and the EU industrial countries. Taiwan is currently the 20th largest economy in the world, with total foreign investment assets of over $2 trillion. It is the fifth largest foreign investor in the world and the fifth largest net creditor nation.
Manufacturing accounts for over 36% of Taiwan's GDP and contributes over 50% to economic growth, the highest in Asia. Taiwan's listed companies invest and set up factories overseas, and their overseas offshore processing and manufacturing import and export trade exceeds $1 trillion each year (most of which is included in Hong Kong's import and export trade figures). The import and export trade of these Taiwanese companies is not included in Taiwan's import and export trade figures.
If the import and export trade of Taiwanese companies' overseas factories is included in Taiwan's own import and export trade figures, the total global trade volume of Taiwanese companies will reach $1.9 trillion, surpassing Japan and the Netherlands to become the fourth largest trading power in the world after the United States, China, and Germany.
Taiwanese companies' overseas factories have supported the families of hundreds of millions of employees in China, Vietnam, and Southeast Asia.
It is estimated that Taiwan will enter the top 20 economies in the world in 2023 based on its own domestic production and manufacturing import and export trade, becoming a member of the G20. Among the G20 countries, Taiwan is the only one with no natural resources, relying solely on manufacturing, and with a population of 23.5 million and the smallest land area.

[messestwang]

The MediaTek was actually a spin-off of the UMC's design department. The high ranking managers all have major share of MTK stock, and which is very juicy.

[EmcEggs]

The winner takes all: an advanced industrial complex behind semiconductor manufacturing (tsmc, UMC et al) & design (MediaTek and more) is also responsible for 80+% of global AI hardware systems

[lil----lil]

winnie (Xitler) does NOT approve this video. I hear a few broken honey jars today! 😅😅😅😅

[bryan]

2024/10/27 Largest Companies by Marketcap NO.8 TSMC $1.055 T

[eureka]

The message area is silent, and there is no opposition, and it seems that Taiwan will continue to dominate semiconductor production for the foreseeable future.

[twrandy]

The reason Taiwan is #1 in semiconductor manufacturing, is still labor cost advantage
But it's a little bit more than the usual labor cost advantage:
1. Semiconductor manufacturing process requires thousands of capable brains to develop design details(most of the development is drilling on some tedious minor topics but still require capable brains, so you need a lot of colleague or above grade staff), debug, process tuning, issue solving everyday, people do not understand, that in semiconductor factory, things do not run itself w/o issue, there are hundreds of issues and abnormalities to be solved, and this needs hundreds of capable brains to figure out what happened and how to resolve them
2. Hence, in order for semiconductor manufacturing to keep running and growing, you need to hire a lot young workers with colleague or above grade, and raise hundreds of millions or even billions US$ every year, for instance, TSMC hires 3~5K new employees every year, not because TSMC grows workforce that much, but because thousands of workers wear out and quit
3. To achieve this, TSMC has to be attractive on employment market, TSMC pays 2~3x higher than Taiwan average salary, so TSMC is doubtlessly the company hires most people with relatively higher compensation (of course there are other companies pay more than TSMC, but those companies do not hire as many people)
4. Taiwan's average salary is only 1/3 of USA, therefore for a US based semiconductor manufacturer, it has to pay 6~9x higher salary then TSMC, to be "as attractive on US market to potential employees as TSMC does in Taiwan", and it is simply not possible
5. Not only TSMC has much more capable brains than its US peers, but also those workers work way much longer, more diligent than US workers

For the same issue, in Taiwan there can be several engineers work on it w/o a break until it is fixed, perhaps in hours or 1 day. In USA, you may take a day looking for someone to fix it and he/she does not work overtime, so the same issue may be solved only 1 week later or even longer.

So, Trump is ridiculously innocently wrong, Taiwan did not steal semicon manufacturing industry from USA, it's USA tech giants want fast and perfect delivery of product, and USA company just can't do it

[StarSystem-pi]

👍Taiwan's economy is growing thanks to its "semiconductor industry, " but the country can also be dangerous because of "semiconductor industry." The dependence of Taiwan's economy on the semiconductor industry is too high. (Most of the top companies in the country by market capitalization are in the semiconductor or related ICT industries. And I know the Taiwanese call TSMC the "guardian mountain of the country.") Taiwan needs to take a page from its neighboring powerhouses, South Korea and Japan, which have diverse industrial portfolios, including not only semiconductors but also the automobile, shipbuilding, steel, biotechnology, and cultural industries.

[ethanhu]

Taiwan has three fabless IC design house that ranks in the top ten among all fabless companies, Mediatek, Novatek and Realtek. An interesting note is that Mediatek and Novatek were actually spin-off divisions from UMC!

[dontknowi]

台灣只能發展科技業是因為我們無法加入任何國際貿易組織
所以只能出口零關稅IT產品

[中央山脈-ci]

👍good explanation. Although that's the map you use, Your map is a little bit far, if you put Taiwan in the middle, US will only on the right across Pacific Ocean, doesn't need to cross the whole Asia and European continental.

[ChihYaunCheng]

Maybe you could introduce how Royal Phillips role along with Taiwan Semiconductor development

[hsiacc]

In reality, the development of Taiwan's semiconductor industry has little to do with Chiang Kai-shek's government. The main influences on this industry's development are the administrations of Chiang Ching-kuo, Lee Teng-hui, and Tsai Ing-wen. The Chen Shui-bian administration was mired in political struggles and increasingly pro-China international relations, with little to show for it. The Ma Ying-jeou administration, on the other hand, adopted a self-deconstructive and weakening approach, leaning towards the Chinese Communist Party, essentially becoming a leader who betrayed his own country and achieved nothing significant.

[RongYuXu-gzcr]

I noticed that the person who provided Chinese subtitles in this video wanted to emphasize that Taiwan is just a region and not a country😅

[whuangjulia]

It's all because we Taiwanese has to survive in the jungle.

[onereal-yw]

🐼🇲🇳🇨🇳🇲🇴🇭🇰🇹🇼🐼
🎖Republic of China🎖
⚒Waves of Wonder⚒

[tsa.spotter]

It's sad that cheap labor is still an advantage for IT industry. Salary simply did not grew in proportion to GDP growth.