Samsung to invest heavily in 4nm production to compete against rival TSMC

Samsung is seeking to enhance the production of 4nm chips as TSMC is anticipated to start mass producing chips using its 3nm technology early next month. According to one estimate, the Korean manufacturer plans to invest over $3.8 billion in its facilities to make this possible.

This may have been the ideal time for Samsung to accelerate 4nm production and win back its lost customers as it was already providing 3nm GAA chips to customers in a limited capacity. The investment, which totals 5 trillion won, was made, according to Economic News Daily, and Samsung will use it to try to take orders away from TSMC that were given to the latter by Qualcomm, Supermicro, Huida, and other well-known companies.

The manufacturer plans to expand wafer output to 20,000 per month in the fourth quarter of this year, but the required harm may already have been done by the business’s prior inefficiencies. 

Qualcomm is continuing to use TSMC for both the Snapdragon 8 Plus Gen 1 and the future Snapdragon 8 Gen 2 after initially launching the Snapdragon 8 Gen 1 on Samsung’s 4nm technology.

The only option left for Samsung would be to negotiate a cheaper price with Qualcomm to mass produce future chipsets, though even that choice would be risky considering how well TSMC’s foundry has performed thus far. To mass build the second-generation Tensor SoC using the 4nm technology, Google seems to be sticking with Samsung so far. Unfortunately, the advertising behemoth ships a lot fewer handsets than phones with Snapdragon chipsets, so Samsung would gain very little from Google’s orders.

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Research organisations claim that Samsung’s capacity for advanced manufacturing badly lags behind TSMC’s, with the Korean powerhouse producing only one-fifth as much as its rival. It will be interesting to watch whether the company maintains its dominant position over the next several years even though both Samsung and TSMC declined to comment on their plans.

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