He runs one of the most powerful companies on the planet, which includes the entire world’s Big Tech in its client list. Mark Liu, head of Taiwan Semiconductor Manufacturing Company (TSMC) since June 2018, suddenly indicated, shortly before Christmas, that he would resign from his position by June. Without even his announcement, or the name of his replacement CC Wei, being followed by a small media shock wave. Surprising? Not so much if we take into account the discretion with which TSMC has acted since its creation in 1987, despite its No. 1 position in the now so strategic industry of semiconductors (or electronic chips). And then, deep down, the firm has only ever had one real leader: its founder, Morris Chang.
Aged 92, the “father of the Taiwanese economic miracle”, as distinguished by a recent award from the KT Li Foundation on the island, is still a major figure at TSMC. Having withdrawn from all executive functions for five years (after a comeback in 2009), it is nevertheless he who officially announces the construction of a second state-of-the-art factory for the company, in Arizona, in the United States, at the end of 2022 A major event in the company’s history, despite Chang’s reluctance on the subject. A few months earlier, he was also the one who stood alongside Mark Liu to welcome the Speaker of the United States House of Representatives, Nancy Pelosi, during her perilous trip to the island.
The father of TSMC is more broadly an important actor in local political life. “His words are as listened to as those of a head of government,” says Pascal Viaud, president of the semiconductor section at the France-Taiwan Chamber of Commerce and Industry, based on site. It is again him who was sent by Taiwan as special envoy to the summit of the Asia-Pacific Economic Cooperation (Apec) last November. He, again, who claims to have direct contacts with Xi Jinping, the Chinese president, while tensions in the Formosa Strait between Taiwan and its imposing neighbor are high. This is explained simply: its jewel contributes to the economic influence of the island and its strategic importance. TSMC brings in its wake a thriving economy; semiconductors are responsible for more than 40% of Taiwan’s exports and accounted for a quarter of its GDP in 2022 according to a report by American think tank theAtlantic Council.
Big Tech’s Best Friend
Morris Chang, of Chinese origin, imported know-how to this Pacific island from the United States where he lived and worked between 1949 and the beginning of the 1980s. Trained at the famous Massachusetts Institute of Technology (MIT), where he discovered computing, the engineer spent twenty years at Texas Instruments, and became the first observer of the growth of the semiconductor industry, facing competitors like Intel.
Back in Taiwan, Chang took the helm of the Industrial Technology Research Institute (Itri), from which TSMC would emerge. His influence is enormous. The engineer is at the origin of the reorganization of the value chain of the chip industry, by separating their design (remaining in the United States) from their manufacturing, then massively exported to an Asia considered more productive. This division of tasks has been an accelerator of development for big names in Tech such as Apple or Nvidia, who thanks to TSMC, have never needed to build factories (“fabless”) for these small elements so essential for the performance of their devices as complex and expensive to design. It has been a boon for TSMC itself, which has always been one step ahead of the competition. The company now controls more than 60% of the global market, and almost exclusively manufactures the most advanced nodes, less than 7 nanometers, embedded in smartphones, cars, satellites and missiles. And of course for Taiwan, which also helped shape TSMC. “The company was financially supported by the government from the start,” recalls François Cotier, director of the Business France office in Taiwan. The State continues to pamper TSMC today, even when the company increasingly decides to export its know-how to the United States, Europe, as well as Japan. TSMC embodies, beyond its industrial excellence, its “silicon shield”, its parade in the face of the growing Chinese threat nearby, which has vowed to regain control of the island. Enough to forge for good the legend of Chang, the “god” of semiconductors, as he is often presented.
And now ? Optimistic about the future of Taiwan in the short term, Chang has however recently become concerned about the end of “free trade” and “globalization”, while the United States and Europe are reindustrializing, and disrupting their supply chains. “Over the next few years, TSMC will likely face greater challenges than ever before,” Morris Chang solemnly declared in October to employees of the firm, reports the Taipei Times. The shadow of China, fierce competition, the end of Moore’s Law… “But I think TSMC will be able to overcome the difficulties,” he added. Word of gospel.
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