Bloomberg: Intel considering outsourcing some production to Apple chip maker TSMC

As Intel plays catch up in the chip production industry, a new report from Bloomberg today indicates that Intel has talked with TSMC and Samsung about outsourcing some production. This comes as Apple transitions away from Intel in the Mac lineup, opting for its own Apple Silicon chips — produced by TSMC — instead.

The report explains that Intel has yet to make a decision about the future of its chip production business. In fact, the company is said to be “holding out hope for last-minute improvements in its own production capabilities.” The report says:

After successive delays in its chip fabrication processes, Santa Clara, California-based Intel has yet to make a final decision less than two weeks ahead of a scheduled announcement of its plans, according to people familiar with the deliberations. Any components that Intel might source from Taiwan wouldn’t come to market until 2023 at the earliest and would be based on established manufacturing processes already in use by other TSMC customers, said the people, asking not to be identified because the plans are private.

Intel CEO Bob Swan has told investors that he will announce his plans for outsourcing and getting production technology back on track when Intel reports earnings on January 21.

TSMC, the largest maker of semiconductors for other companies, is preparing to offer Intel chips manufactured using a 4-nanometer process, with initial testing using an older 5-nanometer process, according to the people. The company has said it will make test production of 4-nanometer chips available in the fourth quarter of 2021 and volume shipments the following year.

Intel’s talks with Samsung, who trails TSMC in terms of chip production capabilities, are said to be more preliminary than the talks with TSMC. Nonetheless, Intel has still faced so many delays in its transition to 7-nanometer production that even a switch to Samsung would accelerate the timeline.

Notably, TSMC is already producing 5-nanometer silicon at volume for Apple.

In July, the company said its 7-nanometer production would arrive a year later than previously planned. That followed a three-year delay in the introduction of the preceding 10-nanometer generation, which is only reaching mainstream use now. Those holdups have allowed TSMC and Samsung to lay claim to better technology for the first time, with TSMC already producing 5-nanometer silicon at volume for Apple and others. That timeline suggests other customers could move to better TSMC production before Intel would.

The full report can be found at Bloomberg.