TSMC deprived Intel of 40% discount due to careless comments by Pat Helsinger

Intel CEO Pat Gelsinger’s comments on TSMC’s presence in China have damaged relations between the companies and deprived Intel of huge discounts.

As it became known ReutersPrior to Helsinger’s remarks, TSMC offered Intel a whopping 40% discount on the production of chips using the 3 nm process. However, the Taiwanese firm decided to withdraw the offer. Since Helsinger took over, the company has focused on regaining leadership in chip manufacturing and created a contract manufacturing division to compete with TSMC. At the same time, Intel has been working with TSMC to produce its own chips.

In 2021, TSMC offered Intel a staggering 40% discount on the 3nm process, then the most advanced. One wafer then cost $23,000, TSMC offered them for $14,000. At the time, Intel was trying to attract US government subsidies for its contract manufacturing. As part of this effort, Gelsinger was keen to point out the geopolitical risks associated with concentrating chip production in Taiwan.

Some of his remarks, which sparked a controversy with TSMC founder Dr. Morris Chang, were made at the Fortune Brainstorm technical conference in Half Moon Bay, California. During the event, Helsinger said that Taiwan is not an unstable place. His remarks were not well received in Taiwan, and Chang was quite outspoken. He replied that Helsinger was too old to make significant changes at Intel and his remarks were aimed at securing subsidies for Intel. Chang also noted that the Intel executive’s comments were emotional, instead of outlining how his firm would overtake TSMC.

Other details shared by the insiders relate to artificial intelligence chips. They note that Helsinger’s public comments on Intel’s AI chip sales were more optimistic than the company’s internal expectations. The problems also forced Intel to cancel the deal with Alphabet and pay a fee after threatening a lawsuit.

Reuters also cites «the latest planning document» from an Intel supplier, which hints at possible delays with the 18A process. Sources add that Intel’s customers do not believe that 18A will be ready for mass production in 2026. Qualcomm and Apple also allegedly refused to use this process because of Intel’s problems.

Source: Wccftech