The chip industry is now swinging the other way.
So the goal is political. The economy can take a hit to achieve it.
Samsung was making Apple's A's in Austin, Texas some time ago, but Apple ditched Samsung's US manufacturing in favor of their China/Taiwan-first offshore outsourcing strategy.
Apple runs an Asia-first strategy these days, they are divesting from China at top speed (whether that's due to sanction threats, the risk of operating in dictatorships, raising wages in China or a combination of that is up for debate). It doesn't make much sense for Apple economically and logistically to use US-made products as they have to be shipped across the ocean to the assembly plants.
I'm not entirely convinced that that's what Apple is doing.
The Information reported[1] last year that Apple made ginormouse investments ($270+B) in China's domestic tech industry to train their workforce and foster China's tech manufacturing. That was 6-7 years ago. It was also revealed very recently that Apple was still trying mighty hard to source more materials and chip suppliers from China's domestic tech industry (eg, YMTC) in spite of the on-going US sanctions on MIC chips -- in this particular case with YMTC, Apple finally gave up only after the Biden admin expanded export control on YMTC last week[2].
I don't think Apple is deterred by Xi's dictatorship, China's geopolitical threats to Taiwan/the South Sea conflict with other SEA countries, or the Uigher (and other ethnic minoority groups) human rights concerns, despite their virtue signaling here in the US. Sure, I think the justification for Biden's foreign/trade policies is up for debates, but what is quite clear is that Apple hasn't really changed its China/Taiwan-first business practices.
1. https://www.theinformation.com/articles/facing-hostile-chine...
2. https://asia.nikkei.com/Business/Tech/Semiconductors/Apple-f...
With China having “seized” Hong Kong, and Russia invading Ukraine, flags went up signaling that the next major move in the future could be China invading Taiwan. And Taiwan is where the most advanced chips are made.
In parallel news, playing with the open source AI models, it’s clear that GPUs are NEEDED in order to run these AI models. Ex: an Nvidia RTX3090 (low end of A100) can run Stable Diffusion in a couple minutes, while my 2013 MacBook Pro, cpu driven, takes ~4hrs to perform the same task.
AI models applied to military uses is a game changer, as demonstrated by Ukraine equipped with US tech.
Mitigating the risk of losing Taiwan, enabling production on US shore, and banning sales to China [1] would keep the economic and military advantage on the US side a bit longer than if things kept going the way they were.
Chips might slump now, but GPUs are gonna be in hot demand, even w/o the blockchain use cases. As demonstrated by the open source AI models, we’re about to replace a lot of stock photos, news illustrations, logo services… and that’s just the beginning.
[1] https://www.bis.doc.gov/index.php/documents/about-bis/newsro...
It's mostly cold war era equipment, designed around the '90s or earlier. Modern AI also seems very failure-prone for military applications around populated areas.
There’s also drones, communications systems, electronic warfare systems, jets etc…
Aerospace code is much too thoroughly-vetted to use something as slow and imprecise as a modern AI system. Existing realtime platforms and sensors are plenty fast, and you can prove that they'll work correctly. Plus, when you're procuring chips to run in an adverse environment, advanced process nodes will probably be too fragile and prone to interference.
Many chips are not fungible, at least not for large-volume orders that incorporate stuff like customer specific mask ROMs or optimizations, and certainly for built-to-order stuff like Apple's SoCs. That means that let's say Apple can't just go and take a bunch of NVIDIA's chips and slap them into their products, and I'd even take a bet and say that manufacturers of NVIDIA cards can't easily take up cancelled order capacity for the same NVIDIA chip from other manufacturers.
If the chips went on sale every year then companies would gamble on additional stock at discount, driving revenue down, and further disrupting the sales transitions into new IC designs.
The rise of TSMC has somewhat increased the national security risk as the market share has shifted away from Intel. We are seeing with the Ukraine War, a reliable domestic supply of semiconductors is now critical to national security.
I expect Intel will continue to be helped along by the US government for some time.
You are right that those semi companies do not need the government investments to build fabs. However, those fabs materialize overseas, depending on overseas supply chains. The EU and US regions want to build out more of the supply chain domestically, for strategic reasons. Those governments could simply legislate to impose heavy restrictions, but that hurts the competitiveness of the companies involved. And so, they combine that stick with a carrot, which is the government investments. You can already see increased restrictions on the semi supply chain in China, timed right after the CHIPS act passed.