The world’s largest contract chip manufacturer, Taiwan Semiconductor Manufacturing Company (TSMC), is apparently struggling to meet Apple’s demand for its 3nm processors. According to MacRumors, TSMC is now building 3nm M3 chips for the MacBook line and 3nm A17 Bionic chips for Apple’s iPhone 15 Pro and iPhone 15 Pro Max. However, TSMC’s 3nm yield rate is only around 55%, which is below Apple’s requirements and is causing supply constraints.
According to TSMC, its 3nm process, which offers a 60% increase in logic density over its 5nm process with a 30-35% reduction in power consumption, is the company’s most advanced chip manufacturing process to date. The 3nm process also supports TSMC’s FINFLEXTM architecture, which enables customers to create systems-on-chips (SoCs) tailored to their unique requirements.
TSMC’s 3nm process technology is considered to be the most advanced semiconductor logic process technology in the market in terms of performance, power consumption and area (PPA), and transistor body technology. However, the sophistication and complexity of the manufacturing process have resulted in a sharp increase in the price of each wafer. Prices per wafer have risen from US$10,000 for each 7nm wafer in 2018 to US$16,000 for each 5nm process wafer in 2020 and now up to US$20,000 for each 3nm wafer.
The manufacturer’s order volume must meet TSMC’s requirements due to the high cost of the 3nm process. Otherwise, the cost would rise even further. Despite TSMC’s attempts to increase production, there are still not enough 3nm chips available to meet Apple’s demand. It remains to be seen how TSMC and other chipmakers can balance the difficulties of cost, complexity, and supply chain management to meet customer expectations as the competition to design and manufacture the most sophisticated chips intensifies.
