71–80 of 101 posts
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One is OpeX and the other is CapeX. I would argue they are both important.
Don’t confuse the map for the territory. Dollars are fungible.
To be fair, I did notice were busy colouring in money with different felt tip pens.
“This is ‘blue’ money and it can’t be mixed with the ‘red’ or ‘green’ money. That would be silly!”
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Competitiveness is an economic concern one can ignore while the government is willing to pour billions on a decade+ timeframe
Sure, China said that about their engines too. When Pakistan came to them looking to buy an F-16 replacement under contract, China couldn't provide competitive designs without using Russian powerplants. They would build the JF-17 for export, and that jet (built in 2003) wouldn't receive domestic engines until a 2019 overhaul. By that time they were competing with a ~45 year old USSR-designed engine, the Klimov RD-33.…
CATL, DJI, Douyin & post-grad engineering programs all over the US suggest the answer is "very strong." Underestimating China is not good for anyone wishing to remain competitive
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You mean , like Asml , Zeiss and Jenoptics aren't national manufacturing capabilities? Or ist just your head national = American, western = American and not German , Dutch, European not Western?
For an American, national means built in the US. Unless you believe that Germany and other Europeans are just colonies of the US.
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You can get a loan to spread out payments, reducing operating costs would be similar to reducing those payments. It also impacts viability and resale in second hand markets.
Sure, but the question is the scale. Is debt service 10x operating costs? 2x? 50x? .5x? Those imply very different sorts of business.
I scoured for some other info as well: A single chip would go through a photo-lithography tool about 80 times. A photo-lithography tool can work on approx. 125 wafers per hour (5 FOUPS). A wafer contains ~230 chips. Current EUV light source requires a 20kw carbon laser.
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Sure, China said that about their engines too. When Pakistan came to them looking to buy an F-16 replacement under contract, China couldn't provide competitive designs without using Russian powerplants. They would build the JF-17 for export, and that jet (built in 2003) wouldn't receive domestic engines until a 2019 overhaul. By that time they were competing with a ~45 year old USSR-designed engine, the Klimov RD-33.…
> Cut off from international designs, it's not really clear how strong China's engineering chops are. CATL, DJI, Douyin & post-grad engineering programs all over the US suggest the answer is "very strong." Underestimating China is not good for anyone wishing to remain competitive
To my knowledge, China's most advanced domestic lithography is a dubious 7nm chip with unknown yields made entirely with DUV, not EUV. This is really quite poor and I invite you to share more updated sources if you think that I'm underestimating them here.
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Eh, we've got time. When NATO allies stopped selling China engines for their fighter jets, it took China more than 15 years to bootstrap an aerospace industry that could design engines on-par with Russia. There are a lot of things that China has every incentive to invest in, but literally cannot as a result of sanctions. On top of that - an underappreciated aspect of lithography is yield. It's likely China can alread…
Enormous PRC indigenous turbo jet efforts progress exploded in last 10-15 years coincides with results of tertiary education reforms producing roughly OECD STEM talent combined. The problem post sanctions was there was a lot of work with not a lot of talent, it took time to build up talent generation engines, now PRC on trend to becoming the only country with enough semi talent for entire domestic semi supply chain -…
Maybe they do turn things around, in the long-run. But the US can invest just as hard, and they haven't burned their bridges with ASML/TSMC. On top of that, the US can license IP from companies like ARM that previously weren't even shared with China to avoid unlicensed clones. The US wants their IP and global industry to prop them up here, and I don't think it's crazy to suggest they've got the upper-hand right now.
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> Would be timely if Western politicians showed same concern for national manufacturing capabilities instead of continuously relying on outsourcing. You mean like this? https://en.wikipedia.org/wiki/CHIPS_and_Science_Act
I’m actually excited to see these projects come into fruition. If USA can pull it off, and become competitive in global markets, it’ll a proof that we can still build big projects when we want to. If things go sideways with nothing coming online by the end of 2020s, it won’t look good especially knowing how China just keeps outbuilding us.
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tariffs/sanctions are meant to be long term, 15-30 years before showing effectiveness. they are meant to not stop progress but stop 'compounding' progress. if they show effectiveness sooner even better! but effects are better seen after 10 years. if A has $500 and B has $500 (and each put money away at the end of the year), tariffs on A are meant to 'eliminate' the compounding interest of the market. so over long hor…
That's laughable, China will spend 15-30 expanding on all kinds of technologies while cut from the US by design. I cannot see any long term benefit for the US when it lost access to the largest foreign market and suffers from fierce competition across the world. See the debacle of EV, where Chinese companies are already dominating sales on 3rd world countries and inside China.
the US chip sanctions are viewed happily by the entire industry - except China. This means other countries have a chance to further displace China in the sector. Not agreeing with a certain sanction is fine but my point stands: they are meant to hobble countries long term.
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> Would be timely if Western politicians showed same concern for national manufacturing capabilities instead of continuously relying on outsourcing. You mean like this? https://en.wikipedia.org/wiki/CHIPS_and_Science_Act
The CHIPS act is a big mistake, they decided to give billions of dollars to companies like Intel that decided to layoff thousands of people a few months later. Like always, the US decided to give more money to unaccountable companies that will put this money into their management and shareholder's pockets.
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Enormous PRC indigenous turbo jet efforts progress exploded in last 10-15 years coincides with results of tertiary education reforms producing roughly OECD STEM talent combined. The problem post sanctions was there was a lot of work with not a lot of talent, it took time to build up talent generation engines, now PRC on trend to becoming the only country with enough semi talent for entire domestic semi supply chain -…
That's one way of framing it, but China has worked this way for a while now. China has great jet engines now, but it took them decades to get there once they were deprived of foreign assistance. It's not hard to see the new chip sanctions having an identical chilling effect, deterring a land invasion of Taiwan until China's lithography is self-reliant and competitive. Right now, they are arguably forced to import for…
Important to contextualize "a while" is really last 10 years - post Tianamen weapons sanctions catchup was still in era where PRC tertiary production was fraction of current talent production with massive brain drain. Turbojet catchup was contingent on 10 years of generational tertiary catchup, 10 years of integrating talent into workforce, which semi is benefitting from out of gate/not as cripplingly bottlenecked on. Hence catchup gap/rate likely lessened under current conditions where there's increasingly less talent shortage, with trend of outright talent advantage, i.e. PRC IC white paper from 2018 targetted pumping 30k IC talent per year, now likely around ~550k/700k they think needed for entire domestic IC supply chain (was at ~400k in 2018). Meanwhile everyone else is projecting talent shortfall, so the ultimate catchup is post 2030s when PRC has 700k+/700k semi with likely surplus while western semi try to maintain lead with talent shortage, all the while PRC indigenous semi will chip away at the 300B+ IC imports currently being paid to western semi to support their R&D towards maintaining lead.
> forced to import foreign technology
Question is how long / at which point will PRC be fine with with relying indigenous, rumored indigenous 12nm production line coming online soon. Industrial policy can spam that... then what are the incentives? I argue they would be MORE incentivized to disrupt/degrade TSMC responsible for ~90% of high end nodes even with after CHIPS that disproportionately support the west. The fastest way for PRC to close gap then is to deny west advanced nodes, already largely denied to it. Some PRC planner is crunching the math that if everyone forced to make do with mostly 12nm chips, then PRC is going to have advantage in cost/scale in production AND renewable energy for operation costs. The flip side of the competitive coin and TSMC delimma is to make adversaries less competitive via denial. US can maintain peacetime advantage with lawfare, PRC can erode that advantage with warfare.
> US can invest just as hard, and they haven't burned their bridges with ASML/TSMC
But will it be as effective? Developments around Intel not promising. Even with CHIPs there's no sign US is going to plug talent shortage gap. US can buy the machines, build the fabs, the current bottle neck is still US talent production with respect to semi. Are they going to figure out how to get US fab workers to work as hard as TWnese even with proper compensation?
Also PRC hasn't burnt bridges with ASML/TSMC, US export controls attempted to burn that bridge against their wishes. But current ASML net sales to PRC due to stockpiling ~50% of their global total. They'd be happy to sell kitchen sink to PRC absent export controls.
> they've got the upper-hand right now
I don't think anyone's disputing that. I'm pointing out the contraints to catch timeframe for PRC is likely smaller than vs aviation, and ability for western semi to keep gap less due to current projected talent shortfalls. And once PRC establishes comprehensive semi supply chain, one that does not require multinational coordination, it will have certain competitive advantages. Also the entire point is to pivot away from western tech stack to avoid the ip/licensing fees and chip away US dominance in computing in general. PRC getting their semi up = starting condition for PRC eventually competing against trillions of value of US SaaS. PRC not just unhappy US control semi hardware, it's also unhappy US controls global software/appstore ecosystems. But that IMO much harder and broader battle, but one that is coming.