Apple is in active discussions with Intel and Samsung to establish chip manufacturing capacity within the United States, according to multiple industry sources, marking a significant strategic pivot for the world’s most valuable company. The move reflects Apple’s growing effort to diversify its semiconductor supply chain away from its decades-long reliance on Taiwan Semiconductor Manufacturing Co. (TSMC), which currently produces the vast majority of Apple’s custom processors including the A-series and M-series chips that power iPhones, iPads, and Mac computers.
The talks with Intel and Samsung represent more than a routine vendor evaluation. They signal Apple’s recognition of geopolitical vulnerabilities in its supply chain, particularly Taiwan’s precarious position between China and the United States. With the Biden administration aggressively pushing chipmakers to establish domestic manufacturing through the CHIPS Act—which has already allocated over $50 billion in subsidies to semiconductor manufacturers—Apple faces both incentives and pressure to localize production. The company’s reliance on TSMC, which operates advanced fabs in Taiwan and has recently expanded into Arizona, creates single-point-of-failure risks that major corporations and governments increasingly view as untenable in an era of great-power competition.
However, the confidential nature of these negotiations masks a central technical and commercial challenge: Apple’s custom chip designs have been optimized for TSMC’s manufacturing processes over more than a decade. Moving production to alternative foundries—whether Intel’s newly upgraded fabs or Samsung’s foundry division—would require significant redesign work and carries the risk of performance degradation or yield problems. Industry analysts note that Intel and Samsung, while capable advanced chipmakers, have not historically matched TSMC’s precision at the cutting edge of semiconductor manufacturing. This technical uncertainty explains why Apple remains cautious about fully committing to non-TSMC suppliers.
Intel, under CEO Pat Gelsinger’s foundry-focused strategy, has invested heavily in regaining manufacturing leadership and has secured U.S. government funding to build new fabs in Ohio, Arizona, and other states. The company sees Apple as a crown jewel customer that could anchor its foundry business and provide the volume and brand credibility needed to attract other high-end chip design companies. Samsung’s foundry operations, meanwhile, have struggled to compete with TSMC in the premium segment but remain a viable alternative with significant manufacturing capacity and government backing from South Korea’s industrial policy initiatives.
For India and the broader South Asian technology ecosystem, these developments carry indirect but meaningful implications. Any shift in global chip manufacturing geography could reshape the region’s semiconductor ambitions. India has launched its own Semiconductor Mission with government backing and partnerships with companies like Micron and others to establish local chip fabrication capacity. A successful outcome where Apple or other major tech companies establish alternative suppliers outside Taiwan would validate the geopolitical rationale for distributed semiconductor manufacturing—precisely the argument India has been making to attract fab investments and government subsidies. Conversely, if technical barriers prove insurmountable and Apple remains tied to TSMC, it would underline just how difficult it is to replicate Taiwan’s manufacturing excellence.
The implications for TSMC itself are complex. Complete abandonment is unlikely given TSMC’s unmatched technical capabilities, but even a 10-15 percent reduction in Apple’s orders would be material given that Apple accounts for roughly 20-25 percent of TSMC’s revenue. Such a shift would pressure TSMC’s margins, accelerate its U.S. expansion plans, and potentially free up capacity for other fabless design companies competing for TSMC’s constrained production. For Apple, maintaining a multi-supplier strategy offers insurance against supply disruptions but increases complexity, costs, and engineering overhead across multiple product lines.
These negotiations also reflect the increasingly politicized nature of semiconductor manufacturing. The U.S. government views domestic chip production as a national security imperative, equivalent to energy independence or defense manufacturing. Taiwan’s geopolitical status makes this more acute: as Chinese military pressure on Taiwan intensifies, policymakers in Washington have begun treating TSMC dependency as a strategic vulnerability. Apple, as America’s largest company by market capitalization and a key player in the global supply chain, has become a de facto instrument of U.S. industrial policy even as the company pursues purely commercial interests.
What emerges next will likely be a compromise scenario rather than wholesale abandonment of TSMC. Apple may allocate certain less-demanding chip components or older-generation processors to Intel or Samsung, while maintaining TSMC as the primary supplier for cutting-edge performance-critical chips. This hybrid approach would satisfy geopolitical objectives of spreading manufacturing risk while preserving the technical quality that Apple’s brand demands. Industry observers should watch for announcements of concrete foundry agreements or fab capacity reservations, which would signal whether these talks have moved from exploratory to binding commitments. The outcome will reverberate across global semiconductor markets, influence India’s own fab ambitions, and reshape technology supply chains for the next decade.
