[HN Gopher] Intel in talks to produce chips for automakers withi...
___________________________________________________________________
Intel in talks to produce chips for automakers within six to nine
months
Author : alexrustic
Score : 293 points
Date : 2021-04-12 23:05 UTC (23 hours ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| aj7 wrote:
| Intel in talks to act as "1.5 level" chip foundry.
|
| or
|
| Intel's commitment to a "mixed foundry-proprietary" business
| model.
| ju-st wrote:
| Not a single Intel Atom embedded (E3xxx) is currently available
| at Mouser
| nullserver wrote:
| Ancient article I read talked about how with a single press
| announcement on Intel's upcoming 586 architecture. 2 or 3
| competitors simply gave up.
|
| Never mind that by the time Intel actually delivered the other
| players would have been at the same tech level.
| unnouinceput wrote:
| I would not buy a car that has BCM/ECU modules with Intel chips
| inside. Undocumented instructions and hidden SoC inside the chip
| itself (https://en.wikipedia.org/wiki/Intel_Management_Engine)
| that you have zero control of, is enough reasons to not trust
| Intel anymore.
| prawn wrote:
| Is this related to the scenario described in the following
| comment at all?
|
| https://news.ycombinator.com/item?id=26659709
| __michaelg wrote:
| Where are all the 8051 jokes?
| baybal2 wrote:
| I doubt most HN readers even know what 8051 is.
| jhgb wrote:
| You should make a poll about that.
| __michaelg wrote:
| They might not know what 8051s are, but they are still in
| their cars :D
| kevinob11 wrote:
| Does that mean they will be in cars in ~6 years?
| xt00 wrote:
| Yes, that is the typical timeline for getting silicon into cars
| from my experience. They make announcements like this to tell
| engineers, "hey we are interested in this area, please check
| out our dev kits." Most likely in the ADAS area is what they
| are targeting to compete with nvidia and others.
|
| Intel I'm assuming did a brainstorm relatively recently and
| wrote down on a white board "what should we be focusing on"..
| and they probably wrote down:
|
| -cloud server infrastructure
|
| -something to compete with the Apple M series processors
|
| -high margin businesses ( cars / self-driving and military /
| large super computer installs )
|
| So basically my understanding is that they use the lead
| customer in each product segment they care about to help them
| define the cutting edge for that space. So they probably will
| use Microsoft/Azure for cloud customer leadership, some
| competitor of Tesla like VW or Mercedes for ADAS stuff, and
| military they probably are already doing fine there. Especially
| with the new Arizona fabs.
| bri3d wrote:
| It doesn't sound like they're designing a new line of
| silicon, but rather offering up pure fab to someone like
| Infineon for Aurix or Renesas for R-Car or whatever their
| stuff is called lately.
|
| Whether or not that's plausible or a marketing play, I'm not
| sure (since nobody outside of Intel really knows the details
| about Intel's process constraints), but it doesn't sound like
| they are targeting an area of competition where they would be
| introducing new silicon and expecting a whole iteration
| lifecycle. The intent seems to be drop-in replacements.
| trhway wrote:
| >they use the lead customer in each product segment they care
| about to help them define the cutting edge for that space.
|
| with that customer naturally describing a faster horse that
| it wants :)
| thunkshift1 wrote:
| Good way to repurpose billions poured as capex into the older
| nodes
| leesalminen wrote:
| Aaq
| BooneJS wrote:
| 9 months from inception to first silicon is close to the speed of
| light, development and manufacturing-wise. I wish them good luck,
| as this is impacting several industries downstream.
| [deleted]
| Invictus0 wrote:
| Correct me if I'm wrong but I believe the article is saying
| that outside companies will come in to use their existing
| designs on Intel equipment; Intel won't be designing new chips
| themselves.
| guepe wrote:
| A fairly large amount of work is required to re-map the
| design onto Intel standard cells, which are not compatible
| with others. This means entire backend needs to be re-done.
| It's very significant amount of work.
| floxy wrote:
| Why would they port them to use new standard cells? Why
| wouldn't they just use the existing physical layout artwork
| to make new masks (i.e. GDSII files)? Assuming a closely
| compatible process. Maybe that's the catch? Intel's
| existing processes aren't close to anything anyone else
| has? Not that I think 6-9 months is reasonable.
| BooneJS wrote:
| If it's just standard cells, then it could go quick.
| Change technology library and synthesize. But if there's
| process-specific IP (analog serdes, non-standard cells,
| etc), then that takes work. I presume most automobile
| chips are not leading node high-speed switches.
| dboreham wrote:
| Because the layout depends on the process. And processes
| are different.
| [deleted]
| BooneJS wrote:
| That, and 3-4 months for manufacturing and test between
| tapeout and power-on. Automotive silicon has different test
| requirements than your average laptop widget.
| astockwell wrote:
| My favorite movie: senior executives with a history of getting
| engineering estimates wrong, making promises about engineering
| timelines. _grabs popcorn_
| nabla9 wrote:
| That's why Intel got rid of Bob Swan (MBA) and hired Gelsinger
| as GEO. Gelsinger is in an engineer, he was the architect of
| Intel 80486.
| User23 wrote:
| I went from bearish to bullish on INTC when they hired a
| product guy instead of a bean counting guy. 5 years from now
| we're going to look back on Intel as an incredible
| opportunity.
| totalZero wrote:
| Swan wasn't the problem, as I understand it. Krzanich was
| an atrocious leader, and Swan's job was basically to put
| out the dumpster fire that Krzanich left behind after he
| was forced out.
| jvanderbot wrote:
| This is "Intel: The sequel. Uninformative priors abound"
|
| e.g., Under new management.
| ta988 wrote:
| New head, same body! Its likely the reflex are still here.
| ihaveajob wrote:
| Who knows, they've been trying to get into the fab business
| since I left there about 10 years ago. This opportunity could
| be what finally kickstarts that idea into reality.
| anonuser123456 wrote:
| What kind of diodes will they be producing?
| fomine3 wrote:
| I can't wait to buy a car with Intel Inside and Centrino
| stickers.
| JohnJamesRambo wrote:
| Imagine when you hit that "turbo" button like on the 486.
| mrweasel wrote:
| Isn't that technically what the "Eco" button in some cars
| does. The turbo button didn't make the computer go faster if
| I recall, it reduced speed when activated.
| JohnJamesRambo wrote:
| Yeah I googled it yesterday to see what it even did and it
| made the computer slower. I'm not sure I knew that back
| then...afraid I was setting computers slower.
|
| You can see where consumers could be confused since they
| basically made a word mean the opposite of what it means.
| Someone needs a paddling for that.
| jaimex2 wrote:
| Does this mean some cars will have Intel inside stickers?
| aero142 wrote:
| Reading between the lines, it sounds like they are supplying
| chips domestically to remove a dependence on a foreign,
| unpredictable supply chain, and are able to use fabs that are
| losing relevance for server chips in a way that doesn't matter to
| the car manufacturers.
|
| Sounds like a win-win, but I'm guessing the next thing we will
| hear is a pitch for federal subsidy for this under a national
| security banner.
| Ericson2314 wrote:
| Yes, much state capitalism all around here.
| delfinom wrote:
| Hilariously one of the backlogs I know of are PMICs from TI. TI
| produces most of these ICs domestically already, it's just car
| manufacturers fucked everything with their incompetence at
| supply chain forecasting.
| blihp wrote:
| tl;dr version: there's nothing unpredictable about the supply
| chain if you don't cancel your orders.
|
| That's the narrative (re: dependence on foreign chips), but
| it's not what actually happened. Last year the auto
| manufacturers anticipated a slowdown in demand and cut back on
| inventory orders. This made sense at the time (to reduce
| orders) given the uncertainty but it sounds like they pretty
| much cancelled them. They likely figured that their suppliers
| would be happy for the business when they returned.[1] The semi
| companies just put other customers in line ahead of them and
| now the autos are screwed since they are facing incredibly long
| lead times for chips and don't have the inventory to bridge the
| gap to make the number of vehicles they need.
|
| This benefits Intel because the line of customers looking for
| 14nm chips at the prices Intel probably wants to charge likely
| isn't very long. However, they've found a perfect (i.e.
| desperate) customer in the autos. So it's actually a win-win
| for the time being.
|
| [1] This actually works if you're a supplier exclusively to one
| company/industry. It doesn't work so well if you have other
| options.
| totalZero wrote:
| > there's nothing unpredictable about the supply chain if you
| don't cancel your orders
|
| Unless there's a fire at an AKM plant. Or a fire at a Renesas
| plant. Or a drought in Taiwan. Or blackouts in Texas.
|
| When you're running at low utilization, lead times are
| shorter and the market is more forgiving of order alterations
| and incorrect predictions of demand. But that's not the case
| right now, and there have been several exogenous setbacks for
| the sector.
| blihp wrote:
| Fair points re: disruptions... but you will have those
| issues anywhere in factories run by any company. I was
| responding to the implication that there's anything
| inherently unpredictable in the chip companies being
| foreign. My point was that the autos are uniquely screwed
| vs. many other customers of the chip companies due to their
| own decisions and actions.
|
| Regarding utilization rates, that's probably where most of
| my snarkiness was coming from: the autos knew demand was
| high before they cancelled their orders and they chose to
| do so anyways. I'm sure they had every right to do what
| they did (contractual language allowing for cancellations
| etc), but when you step out of line for whatever reason it
| should come as no surprise that when you decide that you
| want to be in line after all that you're going to now be at
| the back of it. This has nothing to do with an
| unpredictable supply chain and everything to do with an
| unpredictable customer who didn't plan properly. Yet the
| story gets played up as the failure of a brittle supply
| chain.
| luxuryballs wrote:
| Might as well unfortunately, if they aren't going to cut all
| the regulations that drive up the cost of employment and
| manufacturing. At this point it feels like another hit of
| economic heroin is the only thing staving off fatal
| withdrawals.
| defaultname wrote:
| Intel has a number of advanced foundries around the world, and
| they're jockeying for business as their cash cow sees a bit of
| threat. Every wafer-for-hire foundry is running at >100%
| utilization so it's basically printing money at this point,
| especially if you have a slightly older foundries that aren't
| up to par for creating the cutting edge of chip, but they're
| perfectly adequate for making most automotive electronics (e.g.
| 28nm).
| gumby wrote:
| > I'm guessing the next thing we will hear is a pitch for
| federal subsidy for this under a national security banner.
|
| Just open your ears and you'll hear it already: "Intel CEO
| calls for "moonshot" to boost U.S. role in chipmaking"
| https://www.axios.com/intel-ceo-gelsinger-chipmaking-moonsho...
|
| Nom nom!
| alfiedotwtf wrote:
| Maybe it's just me, but did anyone else read it is "dying company
| to focus on producing for dying industry"... seems like a wrong
| move to me
| delfinom wrote:
| Automotive is hardly dying. It is however in a natural
| downcycle even before corona. The real story is people don't
| have money. Even before corona, used car prices have been
| absolutely exploding as a result of less people having money
| for even leasing cars.
| totalZero wrote:
| Nah. Both of those 'dying' businesses are seeing an explosion
| of demand.
| randomopining wrote:
| How is automotive a dying industry lol? How do humans get
| around in your world?
| nfoz wrote:
| Probably way off-topic but I hope this doesn't imply that cars
| are going the way of Smart TV's where they have some annoying and
| underpowered tech in them to force an early obsolescence on a
| machine that is otherwise fine and could last decades.
|
| But I suspect that ship is sailing regardless.
| klelatti wrote:
| Presumably this means that Intel expects margins on the auto
| chips to be higher than on what this capacity could be producing
| for Intel's own products. Given Intel's margins are already high
| this could mean:
|
| - Very, very attractive margins on the auto chips.
|
| - Much lower expected margins on Intel chips or idle capacity.
|
| So which is more likely?
|
| (and of course Intel quickly establishes a position in a new
| market in line with PG's strategy and gets some good PR).
| PartiallyTyped wrote:
| Neither. Probably recycling/repurposing of older fabs. Afaik
| car manufacturers are not looking for cutting edge chips found
| in memory, cpus and gpus, so older fabrication lines can be
| repurposed for that role and provide an alternative revenue
| stream for intel until they manage to sort their CPU fab line
| out.
| klelatti wrote:
| Not convinced. Multiple processes mentioned in the piece.
| Maybe there is capacity being freed up as 10nm comes on-
| stream but seems likely that they are anticipating some
| weakening of demand or moving some work to TSMC.
| PartiallyTyped wrote:
| They certainly expect lower demand on their current chips
| as they run hot(er) and with fewer cores. They have bought
| a percentage of TSMC's production but TSMC is not very hot
| about them either as they are building new fabs for their
| 7nm chips.
| rossdavidh wrote:
| So, Intel has been having trouble getting their cutting-edge
| (very small geometry) manufacturing to work. Automotive chips,
| however, I believe typically do not require the very newest,
| smallest geometry manufacturing (although they have other
| peculiarities and demanding requirements).
|
| I was, many years ago, employed as a manufacturing engineer in
| semiconductor fabs that, once no longer cutting edge enough to do
| the latest CPU's or memory chips, would transition to doing
| higher-voltage stuff. It's a reasonable thing to do. It does not
| necessarily speak well of Intel's current situation, though, with
| respect to CPU and memory chips, that they consider this a good
| move. But, given their current situation, it probably is making
| the best of a bad situation.
| mmmBacon wrote:
| The challenge with automotive parts is reliability and
| performance over extended temperature and humidity range.
|
| This is not necessarily something you are just good at because
| you already produce semis.
| chubs wrote:
| Automotive ECUs solve the humidity problem by putting the
| boards in a pot of epoxy (talk about overkill!), and as for
| reliability, all my ancient computers still work just fine,
| the only things that ever die seems to be the capacitors or
| leaky CMOS batteries, i'd be happy to buy a car with an intel
| xeon (ECC PLEASE!) as the ECU.
| amluto wrote:
| > intel xeon (ECC PLEASE!) as the ECU.
|
| LOL. Any code that relies on fast interrupts is a lost
| cause on x86. A 32 MHz ECU may dramatically faster at
| interrupts that a top of the line Xeon :)
|
| The power consumption of a pile of Xeons will add up fast,
| too.
| aledalgrande wrote:
| So what you're saying is that the die doesn't die? Sorry,
| bad pun, Monday night...
| tempestn wrote:
| Desktop computers, or even servers, don't need to handle
| anything like the heat, cold, or vibration that cars are
| subjected to though.
| qznc wrote:
| Intel is already producing for automotive with the Denverton
| chip.
| mc32 wrote:
| So if those who make semis for the military have capacity,
| then they can make them for the automotive industry.
| moftz wrote:
| It goes consumer grade, automotive, military, and then you
| have levels above that meant for things like space and
| down-hole oil drilling. Automotive is certainly a step up
| above consumer grade but it's not like Intel is throwing an
| i7 into a car. They are going to just offer fab capacity to
| anyone that can build on the various technologies that can
| be built at Intel's fabs.
| mmmBacon wrote:
| This is not really true. Firstly, the volume for automotive
| is much higher. 2nd the cost structure is entirely
| different and a business set up for high cost low volume
| military parts may not be competitive in automotive with
| low cost.
| mc32 wrote:
| I think ramp up is more the issue. The cost of idling
| plants and ceding market share outweighs any added
| component cost (within reason).
| SavantIdiot wrote:
| Intel made military versions of their semiconductors for
| three decades (inclluding the 386). Rad hardening anyone? (In
| fact, alpha strikes are part of their low-voltage memory QR
| statistics). Military is far more robust than automotive.
| There is probably still enough tribal knowledge there to call
| back on. Maybe. They might have all retired or died.
| mmmBacon wrote:
| Automotive is actually quite reliable and military spec
| parts are often automotive rated parts that have additional
| testing and/or slightly different packaging.
|
| The military has been using automotive grade parts to
| reduce costs where possible.
|
| https://www.dla.mil/Portals/104/Documents/LandAndMaritime/V
| /...
| vzidex wrote:
| Military is still a major customer, at least for their FPGA
| division (Altera). Probably still enough smart people
| kicking around to make it work.
| [deleted]
| CivBase wrote:
| No worries! With how long it has taken them to move past
| 10nm, Intel has become quite adept at making CPUs run in
| extremely high temps.
|
| I couldn't resist. The joke was just too easy.
| kevin_thibedeau wrote:
| It's something Intel _used_ to be good at until they
| dismantled all of their other chip lines in the 90 's and
| 00's.
| olyjohn wrote:
| My 1989 Honda has an Intel chip that powers the ECU. They
| have been in millions of cars, so I would say they probably
| have some knowledge buried somewhere in the company.
| valzam wrote:
| Someone retired engineer is about to get a very lucrative
| consulting gig
| rjsw wrote:
| Your 1989 chip can be emulated in software by a modern ECU.
| olyjohn wrote:
| That wasn't really my point. The point was that they
| probably do understand the conditions under which
| automotive and other more rugged applications work.
| rjsw wrote:
| Automotive electronics have changed a lot since 1989,
| your Honda won't even be using a CAN bus.
| chasil wrote:
| As I understand the problem:
|
| Auto manufacturers need 380nm production lines.
|
| They unwisely canceled all their orders for >6 months.
|
| Their suppliers mothballed all these antiquated facilities.
|
| Maybe Intel can make money with this. It will be interesting
| to see.
| wyldfire wrote:
| > They unwisely canceled all their orders for >6 months.
|
| These guys hate inventory with a raging passion.
| Guest42 wrote:
| That's one thing I noticed in aerospace. The executives
| would far sooner run out of parts and have very expensive
| delays in order to hit turnover targets than to have a 2
| month buffer to handle demand surges or scheduling
| variability. Then they'd leave for similar roles at
| bigger companies.
| akiselev wrote:
| _> The executives would far sooner run out of parts and
| have very expensive delays in order to hit turnover
| targets than to have a 2 month buffer to handle demand
| surges or scheduling variability._
|
| That sounds like a contractor milking a cost-plus
| contract.
| Guest42 wrote:
| Can you explain? This was a cost center for a large
| conglomerate with a number of multi-year contracts but I
| haven't heard of cost-plus contracts only cost-plus
| pricing.
| cptskippy wrote:
| > haven't heard of cost-plus contracts
|
| I don't know why someone would agree to them, but they're
| fairly common. Nasa awarded Boeing a cost-plus contract
| for the SLS.
|
| Basically they're awarded a contract for the cost
| estimate plus any overruns, it's basically a blank check.
| hef19898 wrote:
| Coming from a Supply Chain function in aerospace, I have
| to agree and disagree. 2 months of stock are somewhere
| around a turn rate from 4-6. A region some aerospace
| companies can only dream of.
|
| The problems are, that they stock to much of some parts
| and not enough from others. That problems gets worse when
| programs reach end of life, obsolescence is a severe
| problem then.
|
| Most of the demand fluctuations in aerospace, less so for
| spares, is home made. Delivery lead times and production
| lead times are so long, that done right, fluctuations are
| mainly a problem for long lead time items. And that is
| manageable.
| Guest42 wrote:
| I meant 2 months more as a floor across a majority of
| items(and it's been a long time since then so there's a
| certain amount of rounding). Production wanted to
| eliminate shortages whereas executives and accountants
| wanted to optimize turn rates while claiming to care
| about shortages.
|
| Overall, each of the projects had around 2000 unique
| parts (at least for what this particular plant was
| making). Occasionally, newer contracts would get a much
| higher prioritization and could grab parts (and
| employees) from older projects. Another scenario that
| would lead to extra demand was having test failures on a
| project that was nearing design freeze.
|
| I ended up changing industries to financial services, but
| will always have a deep respect and appreciation for what
| went into those projects.
| hef19898 wrote:
| The funny thing is, that aiming for inventory levels, or
| certain levels across the board, can increase the
| likelihood of shortages. Higher stock means larger
| production lots and longer lead times. If for some reason
| your planned production / procurement doesn't match
| demand, almost a certainty with large production runs,
| one part cart run out of stock. And the large production
| runs make replenishment of this part difficult.
| Guest42 wrote:
| It was a very fun game that required knowing the capacity
| of each supplier and their suppliers as well. The sales
| orders had to get matched up with airplanes and sometimes
| the planes would have shortages that would then instantly
| changes years' worth of scheduling.
|
| Overall I felt like there were a number of good
| strategies but that sometimes the strategizing interfered
| with the execution. Peoples tenure and the projects they
| went through often influenced their notion of ideal. By
| the time I started getting comfortable understanding
| these things, it was time to get a new job.
| cptskippy wrote:
| > The problems are, that they stock to much of some parts
| and not enough from others.
|
| Is there a reason for that? I would imagine they'd have
| actuarials telling them exactly how much of each thing
| they need to produce a thing, as well as failure rates.
| hef19898 wrote:
| Inventory management is hard, and one of the main tasks
| of Supply Chain Management. In the end, I have yet to see
| a formula, algorithm or model that calculates stock
| levels that isn't over shooting at a factor of 2, either
| way.
|
| In the end, it is the tram and person responsible for
| inventory planning and placing production / purchase
| orders that set, directly and indirectly, inventory
| levels. In some cases 2 months maybe just right. In other
| cases it maybe 1 month to much, in again other cases not
| close to enough. And that can change over time.
|
| As a rule of thumb, you don't want inventory. It makes an
| operation inflexible and fat. You need it so. Figuring
| that out is the task planners and supply chain managers.
| Some orgs are better at that then others.
| throwaway2048 wrote:
| That's a plague amongst modern management and corporate
| operations, you return amazing numbers by cutting all
| your inventory and production slack and it works
| fantastically, until a slight hiccup occurs and it fucks
| your production for years to come. But that is the next
| guy's problem, not yours.
|
| Efficiency and Robustness are very often a tradeoff, the
| more efficient you are, the more prone your entire
| operation is to minor disruptions.
|
| Something akin to overfitting in machine learning.
|
| Also something to consider is what happens when the
| entire economy is forced in that direction, where you
| either cut everything to the bone for the sake of
| efficiency, or go out of business due to competition.
| GlennS wrote:
| There's also the issue that it's much easier to do
| quality control when you're receiving your supplies Just
| In Time.
|
| The longer the lag between producing a faulty part and
| trying to use it, the harder to diagnose the problem.
|
| The analogous software problem is probably having
| database backups sitting around without regularly testing
| if you can successfully restore from them.
| hef19898 wrote:
| That's why QC happens when parts are received. And not
| when they are to be used.
|
| And I really wished I the "everything is running on JIT"
| meme to die. Because it is just plain wrong.
| varjag wrote:
| A two month warehouse buffer doesn't really pose any
| problems to QC.
| burnte wrote:
| > Auto manufacturers need 380nm production lines.
|
| They "need" chips made on a 28 year old process? I'd really
| want a source for this. Even if it were true, there are
| still fabs that can make .35um process chips.
| akiselev wrote:
| A source for what? Billion dollar capital projects have a
| lifetime of _at least_ 30 years.
|
| RAD6000 CPUs are still made on 0.5um fabs.
| burnte wrote:
| A source that modern cars can't be built without .35um
| chips. I didn't say those old fabs aren't still
| pumpingout chips, in fact I pointed out THEY ARE still
| pumping out chips, despite the parent saying they had all
| been shuttered. I doubt that modern cars can't be built
| without old process chips, but would like a source rather
| than simply saying parent is wrong.
| akiselev wrote:
| My apologies, I completely misread what both you and the
| GP were saying
| Kliment wrote:
| You understand semi-correctly. Here's my analysis on this
| from another thread
| https://news.ycombinator.com/item?id=26659709
|
| The suppliers didn't mothball the facilities (which are not
| at all antiquated, and are massively in use for other
| things), they just sold that capacity to less capricious
| customers.
| rossdavidh wrote:
| It should also be mentioned that worldwide suppliers 1 and
| 3 had a big loss from power outages in Texas in February,
| and then supplier 2 had a fab burn down. But, if they
| hadn't canceled all their orders, it wouldn't be as bad a
| situation as it is.
| KirillPanov wrote:
| > Auto manufacturers need 380nm production lines.
|
| I think you mean 350nm.
|
| This isn't surprising; a lot of nifty features got axed
| after 350nm, like having two full-fledged polysilicon
| layers (a few subsequent processes technically have two
| poly layers but one of them is totally crippled and can
| only be used for flash cells).
| baybal2 wrote:
| Yes, because doping wasn't surviving second poly
| totalZero wrote:
| Intel is playing a PR angle to win hearts and minds for the
| homegrown semiconductor push. Even if an automotive IC move to
| get Congress and the public to appreciate Intel incurs a short
| term loss, it may be economical in the long term because
| there's about to be a lot of government money available to the
| sector.
|
| Also, if they want to get busy with foundry, this is the way to
| do it. It's not like they're doing HPC processors with all the
| trailing node fabs.
|
| I know an engineering researcher who uses a shaft position
| sensor chip that is also widely employed in EVs. They have been
| out of stock for months. That little chip could have major
| implications for many industries and communities.
|
| "For want of a nail..."
| SavantIdiot wrote:
| A little of both, I think. They do have lots of fab capacity
| for older process nodes which are ideal of embedded
| applications. And they do want to boost their PR image, plus
| they aren't wrong: the industry is kinda effed right now with
| TWO fires in Japan (most recently Renesas). It's a golden
| alignment for Intel, and Gelsinger miiiiight be shrewd enough
| to score a home run. But Intel stock? Eeehhhh.... not a long
| term hold, they ain't got a play book after this.
| zitterbewegung wrote:
| A contrary opinion is here by Ian Cutress:
| https://www.youtube.com/watch?v=oaB1WuFUAtw
|
| I think that Intel does have two plays left.
|
| 1. Appeal to the government that they can't go beyond their
| current process node and the government preorders a bunch
| of processors to do this.
|
| 2. Intel abandons new process nodes and becomes a customer
| of TSMC.
|
| If Intel thinks about doing #2 I think the government would
| be forced to do #1 for the sole fact of keeping chip
| manufacturing knowledge in the US
| SavantIdiot wrote:
| I see #1 happening, but I'm not sure how #2 would play
| out. Hundreds of billions of dollars spent on fabs, with
| close to 80% of their employees working in fabs 24/7.
| That would crater several towns in the US (Chandler,
| Santa Clara, Portland come time mind), and just be
| throwing away money. One hell of a capital loss! I think
| there are too many people high up at intel getting stinky
| rich to throw the company under the buss like that. But
| then again it might happen, you're not the first to
| suggest it.
| NegativeLatency wrote:
| Intel is more of a Beaverton thing than Portland
| directly, not saying it wouldn't have an impact but a lot
| of the semiconductor and hardware stuff isn't in Portland
| proper but to the south or east towns.
| SavantIdiot wrote:
| D1X, the beast, is Hillsboro, there's also Aloha, which
| is technically Beaverton, but them's fightin words to the
| locals. ;)
| reducesuffering wrote:
| Santa Clara will be just fine without Intel, guaranteed.
| Regarding #2: that would be the beginning of the end for
| Intel. Gelsinger is reminding me of bringing in Mayer to
| fix Yahoo. Intel is done on design. AMD, Nvidia, and
| Apple are all smoking them and the gap is only widening
| now. Intel would need a miracle to turn around their
| terrible inertia. Investing into being the US fab play,
| their only expertise, advantage, and existing massive
| facilities, seems like the only reasonable path forward.
| MrBuddyCasino wrote:
| What Intel is managing to pull off using outdated
| manufacturing tech is pretty impressive. The low-end and
| mid-end parts are excellent and well priced. They do not
| have a problem in the design department. They are behind
| on manufacturing and they missed the boat on chiplets,
| but this is not fatal - yet. Also consider that Intel
| manufacturing capacity is enourmous, and given the
| current IC shortage, they can probably sell anything to
| OEMs. If AMD could source more wafers, the situation
| might be different, but they can't.
| totalZero wrote:
| Intel won't do option #2 as a full-on strategy, for the
| reasons you mentioned and because it ruins their unique
| value proposition for government subsidy.
|
| But they do need a little bit of option #2, if only for
| market share defense against competitors. TSMC obviously
| prioritizes long-term partnership, but in today's demand
| environment, every wafer that Intel buys is a wafer that
| AMD (or Nvidia) cannot.
| SavantIdiot wrote:
| Also: if China marches into Taiwan, TSMC is off the map
| and the world is fuckered. AliBaba has PinTouge fabs
| which are ramping like mad. Which means China could shut
| down TSMC and come out on top.
| throwaway6734 wrote:
| I imagine the TSMC fab would be destroyed before being
| allowed into Chinese hands
| vkou wrote:
| And then we'll get a decade-long global chip shortage,
| instead of a year-long one.
|
| It's a perfect example of cutting one's nose to spite
| one's face. Also, Taiwan will end up a large, long-term
| loser of that, as well.
|
| China's ambitions on Taiwan have nearly zero to do with
| TSMC's presence there. (And everything to do with the
| past 80 years of history - more specifically, its desire
| to 'conclude' the civil war. If Taiwan's didn't have a
| chip industry, the PRC would still have the same
| _goals_.)
| throwaway6734 wrote:
| >And then we'll get a decade-long global chip shortage,
| instead of a year-long one.
|
| Sure and the fabs that get spun up will not be under CCP
| control which is a clear win.
| mcny wrote:
| How do you think the US (and allies Japan and South
| Korea) would react if China PR marches into Taiwan?
|
| More importantly what do you think China PR thinks the US
| will do if it marches into Taiwan?
| SavantIdiot wrote:
| I think the allies would be immobilized with fear? The
| same way Russia annexed Crimea and nothing happened
| except stern finger wagging from allies. Little Donnie
| Dipshit tried to push China around and they laughed in
| his face. I'm pretty sure that emboldened them.
| Fnoord wrote:
| Taiwan has a different strategic importance than Crimea
| or Eastern Ukraine.
| totalZero wrote:
| Totally depends. If destruction of fabs and
| infrastructure is a _fait accompli_ , war is less likely
| than if there is still a chance to save the fabs.
| emodendroket wrote:
| The US strategy on China is also all about denying China
| cutting edge chips which makes the dependence on Taiwan a
| source of precarity.
| SkyMarshal wrote:
| 3. Intel does exactly what Gelsinger outlined in his
| recent presentation (did you even watch it?). They fix
| their process tech (by moving from Immersion to EUV) and
| catch up with TSMC, they move to a similar "system-on-a-
| package" design as AMD and catch up on design, they build
| their new fabs in Arizona and use those to compete
| against TSMC in the custom fab business.
| helsinkiandrew wrote:
| Relying on government contracts doesn't sound like the
| behaviour of a growth company. Government processor
| technical requirements aren't likely to align with
| commercial requirements. And low risk government cheques
| tend to push out any higher risk commercial innovation.
| nr2x wrote:
| It's working for SpaceX.
| helsinkiandrew wrote:
| True, but rockets are rockets - and delivering a military
| satellite into orbit is much the same as delivering a
| commercial one.
|
| Delivering Military IC's to a contract is very different
| to creating commercial products suitable for laptops,
| phones, AI etc.
| epistasis wrote:
| This is kind of ironic, because the only reason the
| semiconductor industry exists as it does today is because
| massive amounts of defense contracts in the early days of
| semiconductor manufacturing. The US's massive defense
| spending sometimes functions in a more productive way
| than one would guess.
| carlmr wrote:
| And arguably today's silicon valley was built on top of
| this. I mean it's still in the name "silicon".
| epistasis wrote:
| I'd be hard pressed to come with an argument that there's
| any other reason that today's software world is in the SF
| Bay Area. Government contracts attracted initial silicon
| startups, noncompetes ensured entrepreneurship, VC
| developed around the talent, eventually software became
| bigger than the hardware as the hardware was
| commoditized. Amazon and Microsoft were successful in the
| Seattle area, but otherwise the concentration of talent
| in the SF Bay is hard to beat
| mcny wrote:
| > I know an engineering researcher who uses a shaft position
| sensor chip that is also widely employed in EVs. They have
| been out of stock for months. That little chip could have
| major implications for many industries and communities.
|
| > "For want of a nail..."
|
| I remember reading an article about how production of Apple
| Macintosh desktop computers in Texas stopped for the want of
| a specific kind of screw. If I remember correctly, in China
| they would have been able to resume work within hours in the
| worst case.
|
| I have no industry knowledge so no idea of this is true
| though.
| yakz wrote:
| The story says they were delivering partial shipments of
| the tens-of-thousands of screws in their personal vehicles.
| And also, that they couldn't make as many screws as Apple
| wanted.
|
| https://www.nytimes.com/2019/01/28/technology/iphones-
| apple-...
| specialist wrote:
| Hmmm. There's got to be more to this story.
|
| Tim Cook's Apple is a logistics powerhouse. Surely they
| have full control over their entire supply chain. Every
| detail planned long ahead of time.
|
| Which screw part was it? Quick scan of all the popular
| reports doesn't identify the specific screw.
|
| Why not change the design to use a more readily available
| screw?
|
| Why not make a one time order of a box of screws from
| China?
|
| Apple regularly provides the capital so their suppliers
| can ramp up. How much would have cost for that tiny
| Austin screwer suppler to double production? Probably
| less than the loose change found in Cook's office couch.
|
| In conclusion, I don't buy this excuse. I dimly recall
| another report about the struggles the Austin plant had
| producing the Mac Pros. Bad fit and finish. Long turn
| arounds because there's no surrounding ecosystem of
| skills, suppliers, deep experience. Etc. Nothing that
| Apple couldn't have fixed; they just didn't want to.
| csharptwdec19 wrote:
| > The story says they were delivering partial shipments
| of the tens-of-thousands of screws in their personal
| vehicles.
|
| Sounds about right. When my brother was green in his
| automotive supply logistics career, there were a couple
| of times he got thrown on an airplane with a carry-on of
| parts...
| laurent92 wrote:
| Sounds terrible for the chain of custody (The aviation
| had a huge counterfeiting problem in the 1990ies).
| rorykoehler wrote:
| 2nd hand cars have become 20% more expensive here in Germany
| this year (anecdotal based on just buying a used car). This is
| a good move because Intel are being agile and focused on
| solving a real problem. This speaks well for how they will
| respond more generally. They know it isn't below them.
| criddell wrote:
| Used cars are expensive in the US right now too. We had a car
| that wasn't being used very often so my wife suggested we
| look into selling it. Went to the website of one of those
| places that gives you an offer online and the offer seemed to
| good to be true. Took it in to them and walked out with a
| check for the full amount.
| throwaway4good wrote:
| So they are going to become a contract manufacturer of +300 nm
| chips that are sold a few dollars a piece? How is that going be
| a good business for them?
| baybal2 wrote:
| It's a good business for some.
|
| Automotive is sold at n times the markup of commodity chips.
| PaulHoule wrote:
| The auto industry is also moving towards smaller geometry
| parts. Not least of all is the sensors, self-driving,
| telematics, radios and such. There are issues in terms of
| environmental conditions, aging and such, but it is happening.
|
| Conversely, a lot of the trouble with 10nm and smaller
| manufacturing is that they shrank the transistors but didn't
| shrink the dies -- or rather, the ones that did succeed didn't
| "make a giant 5nm CPU" but they decided to make chiplets
| instead.
|
| If you really could make the monolithic 5nm part it would crush
| the chiplets in terms of economics since advanced packaging is
| more like circuit board assembly than lithography. Maybe they
| can do it now with new pellicles, but today small geometry
| parts go good with small dies.
| SECProto wrote:
| > It does not necessarily speak well of Intel's current
| situation, though, with respect to CPU and memory chips, that
| they consider this a good move.
|
| They also announced [1] that they were building two new fabs in
| Arizona a couple weeks ago. There may just be growing demand
| for shortened supply chain in the semiconductor space (recent
| trade/tariff wars, chip shortages from offshore fabs, various
| national security implications)
|
| [1]
| https://www.forbes.com/sites/tiriasresearch/2021/03/23/intel...
| jillesvangurp wrote:
| Actually, modern vehicle manufacturing is mostly bottle-necked
| on software and much of the added value comes via software
| powered by hardware accelerated machine learning. So
| performance matters, a lot.
|
| Legacy car manufacturers are basically playing catch up with
| the likes of Tesla (doing their own chips) or Waymo (nvidia, I
| believe) to fix their supply chain to not have dozens of poorly
| integrated black boxes so they can actually update them in a
| sane way. E.g. VW has been struggling in the last year to get
| that working with the ID3. They are working with Infineon on
| chips for this apparently. Other manufacturers are facing
| similar challenges and are getting there with various levels of
| success. E.g. if you want to update your Kia EV, you need to go
| to the dealer.
|
| So, the market opportunity for Intel is making performant SOC
| aimed at these manufacturers that can keep up with the market
| leaders and can be used while they figure out to get from level
| 2/3 autonomy to level 5.
|
| There probably is a market for dumb EVs as well without much
| intelligence but that also implies low margins. Anything ICE is
| basically what it is at this point. R&D is basically limited to
| milking those legacy product lines until they are eventually
| shut down. So that's not a good market for Intel either.
|
| There are plenty of low margin/low performance manufacturers
| where Intel stands no chance of ramping up to volumes of sales
| that would compensate for the low margins. So, high end EV
| manufacturers with some ambitions on the autonomous driving
| front is the market for this. Anything else does not make sense
| for Intel.
|
| The only question is if they keep on insisting on x86. IMHO if
| they do, they are going to fail, again. Like they failed in the
| mobile market. The right moment to start targeting this market
| was 10 to 5 years ago. They are already late.
| rightbyte wrote:
| > Actually, modern vehicle manufacturing is mostly bottle-
| necked on software and much of the added value comes via
| software powered by hardware accelerated machine learning.
|
| Really? My major concern with any car I have used ever has
| never been software.
| whatever1 wrote:
| Why this obsession with dropping x86? Do we have any evidence
| that arm offers better performance & thermals at the same
| processing node? Only one arm chip today really competes with
| x86 and it is in 5nm node whereas amd is at 7 and intel at 10
| jasonwatkinspdx wrote:
| If the reporting I've read is accurrate, the x86 ISA is a
| limitation on decoder width. Intel and AMD's attempts to go
| above 4 parallel decoders have failed. Apple is shipping 8
| way today.
| hkmurakami wrote:
| Former automotive R&D guy here. It was quite some time ago but
| my colleagues in the chip department (we were all new grads at
| the time) were telling me that they were designing chips with
| triple redundancy. "Hood Space" is a fierce competition among
| vendors to get into car models 5 years in the future, but
| miniaturization needs are nowhere near that of the consumer
| electronic space (this was shocking to me, having been raised
| in SV in a family working in the PC industry!)
|
| Fast forward some years later and I was working at a motion
| sensor company for consumer electronics. Our node sizes were
| like 40-50nm and many generations behind cutting edge ICs.
| Lower margins but meaningful volume. Our fab was naturally, you
| guessed it, TSMC.
| baybal2 wrote:
| Yes, but making otherwise 180nm+ chips on their still very
| advanced fabs would've been a disaster unless automotive's very
| , very fat margins.
|
| It still shows the level of desperation there.
| rossdavidh wrote:
| I should have mentioned that I haven't worked in the
| semiconductor industry for over a decade, so perhaps something
| has changed with regard to automotive chips, but that was my
| understanding at the time I left.
| [deleted]
| User23 wrote:
| Or maybe Intel leadership sees the big picture and they're
| doing their part to help their country.
| lovich wrote:
| I needed a good laugh today
| [deleted]
| ksec wrote:
| May be it is from Pat Gelsinger, so I am uncharacteristically
| optimistic about it.
|
| 1. Intel needs to clear Fab Capacity if they were to move to
| higher node. This is always a problem in the Fab industry.
| Normally Intel just scale whatever product line up they have
| that fits.
|
| 2. Car will be the next SemiConductor Battle Ground. It will
| just be a large computer, lots of sensors with battery moving
| around. Intel already has MobileEye, they might as well partner
| with these largest Car manufacture on Chip design for future
| growth. This is the same play with 5G although Intel seriously
| messed it up.
|
| 3. It also make political wins and help with their change in
| direction of Custom Foundry or now called Intel Foundry
| Services.
|
| For me this is a brilliant move. Assuming they execute it
| perfectly. Some short term pain and lots of long term gain.
| Which is what I like. A vision and strategy how they are going
| to win. Something that was lacking with the previous Intel.
| guessbest wrote:
| Does this mean they are going to onshore their fabrication
| plants based on your experience? It seems like CEOs promise
| that but still go ahead with building plants in countries with
| cheap labor
| sanxiyn wrote:
| My understanding is that fab equipments are so expensive that
| cheap labor doesn't matter. Note that most of Samsung's fab
| capacity is in South Korea and it has no plan whatsoever to
| offshore that. Ditto for TSMC.
| MangoCoffee wrote:
| modern fab is pretty automated. its doesn't required as
| much labors as other industries. Samsung fab was shutdown
| during Texas winter storm.
|
| https://www.statesman.com/story/business/2021/03/30/samsung
| -...
| csours wrote:
| Most of Samsung's fabs may be in SK, but some of it is just
| down the street from me in Austin.
| guessbest wrote:
| I'm near Austin. Where are they?
| csours wrote:
| Between Pflugerville and Manor. The address is publicly
| available with a quick search.
| guessbest wrote:
| 12100 Samsung Blvd, Austin, TX 78754 ?
| totalZero wrote:
| Dollar for dollar, fab is not as labor intensive as many
| other forms of manufacturing. Even if it were, the occasional
| loss of product due to infrastructure problems in
| underdeveloped areas would offset labor cost. It makes sense
| to locate in one area where you can count on reliable
| infrastructure and negotiate good rates due to your massive
| scale.
|
| Fabs use a lot of water and electricity. Samsung announced
| that it was considering a new investment in Austin, then the
| Texas storms hit. A few days later, Samsung announced that it
| was considering a new investment in Austin or somewhere else.
|
| Intel already operates several fabs in the US and other first
| world countries so I don't know what onshore would mean in
| this context, but Gelsinger has made it pretty clear that he
| believes our best bet is to make chips at American fabs run
| by American companies. So I guess that is a yes.
| rossdavidh wrote:
| Intel has always (and continues today) had substantial
| onshore production capacity.
| robomartin wrote:
| The problem we have ("we" meaning the US and Europe) is that we
| have allowed a massive portion of the semiconductor mechanism
| to leave our shores. In a world where electronics are found in
| just about everything, this is a pretty bad situation to be in.
|
| We are in the process of developing a commercial product that
| will require manufacturing at a rate of 10K to 20K units per
| month. When we started this work, semiconductor availability
| wasn't a significant concern. At the start of this year we
| started to receive quotes with lead times in the order of 52
| weeks. Yes, a whole year. Some of the chips we designed into
| this product became unobtainium.
|
| Well. Not quite. We discovered the supply is plentiful in
| China. And, of course, pricing is insane. A device that was
| $0.70 is now over three dollars in China. And, again, of
| course, the only way you can buy it is if you have your boards
| manufactured by the supplier. In our case this would mean a
| contract for 10K to 20K units per month having to leave the
| prospects of US-based manufacturing --which is already a
| difficult proposition under normal circumstances.
|
| Never mind roads and bridges. We don't need to touch any of
| that. We need to dump that money into rebuilding industries and
| reducing their costs of operation to the bone.
|
| Let me put it this way. Everyone can understand that something
| like a basic Arduino is a very simple product. In electronics
| terms, on par with making cloth masks. Well, if you had to
| manufacture a simple Arduino in the US or Europe today, it
| would be impossible. Much as is the case for masks, the raw
| components needed to make such a product are not made in the US
| and Europe. You might be able to have the raw PCB's made. I
| would not be surprised if the raw materials for that process
| were not made in the US and Europe as well (I didn't look into
| it, so I can't make that assertion). Even if you could make
| one, the end-user cost would likely be over a hundred dollars
| per unit (if the components were made in the US and Europe).
|
| That's were we are today. And this isn't going to get any
| better by fixing roads and bridges.
|
| We need to focus on what is truly important. We needed to do
| this ten or twenty years ago.
|
| This effort by Intel might not be all it is reported to be. I
| just hope it is an indication that we are starting to
| understand what we are standing on...and it isn't solid ground.
| [deleted]
| ChuckNorris89 wrote:
| _> Well, if you had to manufacture a simple Arduino in the US
| or Europe today, it would be impossible._
|
| I think you have no idea what you're talking about. In Europe
| at least, there are plenty of fabs that make microcontrollers
| like the Arduino. And the original Arduino boards (w)are made
| in Italy which last I checked is still in Europe.
|
| _> Much as is the case for masks, the raw components needed
| to make such a product are not made in the US and Europe._
|
| In Europe we have also plenty of factories making FFP2 masks
| (my favorite ones I can buy in Austria ATM come from a brand
| made in the Czech Republic).
| robomartin wrote:
| I think you need to read what I wrote more carefully. I try
| to be precise with my language.
|
| Simple exercise: The bill of materials for Arduino boards
| is publicly available. Pick a board. Now go source every
| single component on that board.
|
| Create two spreadsheets. The first would have you source
| what you can from China. The second would source from any
| EU country and the US if you'd like and exclude any Chinese
| made component from the list.
|
| My prediction: You can make 100% of an Arduino in China
| using Chinese components. You cannot make an Arduino in
| Europe or the US without Chinese components.
|
| Let's add another layer to this.
|
| Let's say you create a third spreadsheet where you source
| as many components (and services) as possible from the US
| and Europe and whatever you can't you get from China.
|
| Now calculate the cost for each case: China only. US/EU
| only. US/EU + necessary Chinese components and services.
|
| Prediction: The US/EU cost --if it is even possible to do
| it-- will easily double or triple the cost of that product.
| The US/EU + China cost won't be competitive at all because
| the vast majority of the items will have to come from China
| and you will incur additional costs for producing in the
| US/EU rather than just facing reality and having the
| product made entirely in China.
|
| Please note that I am using an Arduino as a super-simple
| example for the sake of an illustration. It would be wrong
| to engage in dissecting this simple illustration tool in an
| attempt to invalidate my claim. This claim comes from
| decades in manufacturing, where I have faced this question
| of where I can buy components, assemblies and services.
| Twenty or thirty years ago sourcing from the US or Europe
| wasn't horribly difficult. Today, it is frustrating to see
| just how difficult this is. The problem is real.
|
| Nobody is suggesting 100% repatriation of the supply chain.
| That is impossible. There is a number between 0% and 100%
| that would do both the US and Europe much good. I don't
| know what that number is.
|
| Once you start looking at more "real world" products, the
| picture gets dark very quickly. Last year we designed a
| robotic system. Virtually every component that went into
| making this robot came from China. I think I can say that
| the aluminum, sheet metal and bearings did not. While I did
| not conduct a component-by-component survey, I think I can
| easily say that 95% of the electronic components,
| connectors, wires, cameras, displays, sensors, pneumatic
| valves, motors and even the wheels came from China. In
| other words, if you had to make this robot without China
| all you'd end-up with is an empty metal shell. That should
| make everyone take pause.
| yulaow wrote:
| I think, but I am not sure, that parent was talking about
| the whole production chain, from raw materials to end
| product.
|
| For what I remember some(most?) components of arduinos are
| imported from outside EU. Correct me if I am wrong.
| ChuckNorris89 wrote:
| > _For what I remember some(most?) components of arduinos
| are imported from outside EU_
|
| So what? A third of iphone components are imported from
| outside of china. No competitive economy is 100% self
| sustainable.
| hef19898 wrote:
| True local self sustainability stopped being a thing in
| the bronze age.
| robomartin wrote:
| I am using an Arduino as a simple example. Anyone can
| look-up the components used to make one, go through the
| exercise of sourcing them and gain an understanding of
| supply chain realities in this way.
|
| Generally speaking, products with greater complexity
| illustrate this problem far better. The problem is it
| would be impossible for the a reader on HN to dig into
| this reality due to not having access to the bill of
| materials, etc.
|
| I have never said I am pushing for a 100% localized
| supply chain. That would be preposterous. Silly. However,
| the reality we navigate today isn't good at all. Last
| year showed the world what can happen.
|
| China is nearly at a 100% single-source position. This
| varies from industry to industry. And, of course, they
| are not saying "we have enough, let's stop here", they
| are laser-focused on bringing in as much business as
| possible and will absorb as much of the supply chain as
| possible.
|
| What they have done is admirable and nothing less than
| remarkable. I don't fault or hate them for it. They work
| hard and deliver results. They deserve to be where they
| are.
| SavantIdiot wrote:
| Hey is anyone else worried about China halting TSMC and then
| falling back on their PinTouge fabs? Or am I succumbing to a
| right-wing fever dream?
| Traster wrote:
| This is an interesting move - because it seems exceedingly
| unlikely that they'll be able to extract the same margin out of
| automative customers that they get with data centre chips. Which
| means that management in Intel is starting to think about
| pursuing new markets despite sacrificing gross margin - bad move
| financially short term for them, but could be very promising long
| term.
| baybal2 wrote:
| Automotive actually has better margin that even DC chips. The
| problem for them will be that the automotive IC market is
| actually not that big.
|
| A gorilla like Intel will be able to saturate the market few
| times over if we take all of their capacity.
| gumby wrote:
| I'm excited by the possibility of Intel's recovery from it's
| long, slow, near death experience.
|
| That being said this is a classic "grab headlines while one may,
| for by the time the deadline rolls around everyone will have
| forgotten and the goalposts will have moved"
|
| Intel hasn't seriously been in the low margin embedded chip
| business in decades (margin starts terrible and goes down from
| there as product matures and you have to guarantee supply for a
| long time).
|
| Expect a stock bump though.
| ta988 wrote:
| Why would you expect a stock bump? Aren't they likely to risk
| loosing a lot of money by shifting their production? I would
| expect them to be able to make money in long term by doing that
| shift though.
| lallysingh wrote:
| Most investors will see "more customers and demand" and add a
| few shares to their portfolio.
| bhawks wrote:
| Chip shortages have significantly impacted automakers'
| ability to meet new car demands recently. Lots of chatter
| about the problem in the stock market community
| croutonwagon wrote:
| Their stock hit a 52W high today and promptly fell about 3
| points today.
| delfinom wrote:
| Speaking as an EE in industry. Most of us won't go near Intel
| with a 10 foot pole. They have shit on hardware designers in
| the past and they continue to shit on them now. They literally
| pump and dump products like Google without a care in the world
| of sudden discontinuation.
| oddity wrote:
| This isn't just a headline grabbing move. Even ignoring the
| obvious geopolitics, this is still beneficial for all parties.
| Intel, likely, has more idle capacity than TSMC and/or has
| enough leverage on its own demand (its own chips) to make room
| if necessary. It's possibly the only player out there that can
| deliver a 6-9 month turnaround time for the auto industry's
| needs.
|
| On Intel's side, they desperately need to prove that they can
| have an amicable relationship with a customer if they have any
| hope of making their IDM 2.0 model work. This will help them
| build out the relationships they need, assuming they don't
| screw it up.
| lumost wrote:
| This is a pretty good strategy to flush out what's slowing down
| the company. In theory these automakers are willing to pay a
| premium for what is ultimately a commodity chip this year.
| Intel will find out quickly who and what is holding them back
| from delivery.
| elihu wrote:
| > Intel hasn't seriously been in the low margin embedded chip
| business in decades...
|
| I don't see this as them getting into low margin chips. This is
| them selling manufacturing capacity to someone who wants what
| in ordinary times might be low margin chips. And some of them
| might not actually be all that low margin; I assume modern cars
| have one or two computers that are more like smart phones than
| Arduinos.
| gumby wrote:
| Have you ever worked in the embedded space? The technical
| work is often fun while the business side is miserable.
|
| I worked with Toyota when they were literally trying to shave
| a Y=100 from the engine control unit of a new vehicle. A new
| design! Once they entered production they were going to shave
| the cost even more on the backs of their suppliers.
|
| There's a reason why Intel got out of this business. Ever
| wonder why AMD can use x86? They got that license back when
| nobody would design in your part unless there was a second
| supplier of the identical part. So they got a license _so
| that Intel could sell parts_. Intel abandoned that world
| without a backwards glance.
| KirillPanov wrote:
| > Ever wonder why AMD can use x86?
|
| AMD can use x86_64 because _they invented it_.
| belval wrote:
| He said x86, not x86_64 (AMD64).
|
| Intel most definitely invented x86 since the x86 is
| itself a reference to the Intel 8086.
| HeyLaughingBoy wrote:
| > Have you ever worked in the embedded space? The technical
| work is often fun while the business side is miserable.
|
| This is such a perfect description, it make me want to cry.
| reducesuffering wrote:
| > "literally trying to shave a Y=100 from the engine
| control unit of a new vehicle. A new design! Once they
| entered production they were going to shave the cost even
| more on the backs of their suppliers."
|
| Nothing like the possibilities of massive economies of
| scale. There's a reason Toyotas are such good values.
| KirillPanov wrote:
| Wut?
|
| Toyotas are not "good value" because they're cheap --
| just look at the prices for new Toyota Tacomas! They're a
| good value because of the exceptional engineering, and
| they sell at a premium because of it.
|
| People need to stop drinking this stupid "scale is all
| that matters" kool-aid.
| blihp wrote:
| Try talking to an American automotive supplier some time...
| it's generally a lousy business to be in. Fortunately for
| Intel, it's likely to only represent a tiny sliver of their
| business and the American autos are pretty desperate right
| now having emptied a few rounds into their own feet.
| [deleted]
| WoodenChair wrote:
| > I'm excited by the possibility of Intel's recovery from it's
| long, slow, near death experience.
|
| Intel made 24 billion dollars last year on 78 billion dollars
| of revenue. It's not exactly near death. 1996 Apple was near
| death. Intel is having a mid-life crisis at best.
| graeme wrote:
| The problem is fabs need massive scale. If Intel loses the
| scale it won't have the ability to invest at a good cost base
| in new generations and risks falling behind.
|
| Profits today, decline tomorrow. Blackberry revenues grew for
| several years after the iPhone, but they were doomed.
|
| This is Intel's challenge. Present profits are misleading.
| The CEO recognizes it and they have a good shot of turning
| things around though.
| totalZero wrote:
| You can't exactly compare a capital intensive manufacturing
| company to a smartphone company. The capital assets
| involved in what Intel does are so substantial that it
| would take time to unseat them in the best of
| circumstances, let alone right now when even semiconductor
| equipment companies are complaining that they can't get the
| chips they need for their machinery.
| systemvoltage wrote:
| Intel is _growing_ , just not as much as people expect.
|
| That's how companies now are evaluated. Grow or gtfo.
| kevin_thibedeau wrote:
| Don't even think of trying to pay a dividend or your stock
| is trash.
| [deleted]
| BeetleB wrote:
| Intel actually pays fairly decent dividends. Always has.
| GlennS wrote:
| Why would you ever pay a dividend when a stock buyback is
| more tax efficient for US investors?
| ac29 wrote:
| Qualified dividends are taxed at the same rate as capital
| gains in the US. There are benefits to the tax deferring
| nature of stock buyback induced capital gains, but there
| are also benefits to being taxed each year along the way
| via dividends (such as the risk that capital gains tax
| will go up in the future).
|
| Many companies both pay dividends and do stock buybacks,
| Intel among them.
| danielmarkbruce wrote:
| Also, think of pension funds, insurance companies and the
| like - they are huge investors, often pay no tax on
| dividends, and like the (usual) reliability of dividends
| so they can pay out cash as needed.
| gumby wrote:
| But they aren't in any way in control of their own growth.
| See my comment a little above, or simply look at their
| gruesome financials: https://www.intc.com/news-
| events/press-releases/detail/1439/...
| fauigerzigerk wrote:
| Looks more lackluster than gruesome to me. But I think
| they're going to have to slash their margins to keep
| revenue from falling off a cliff when data center ARM
| chips become competitive.
| gumby wrote:
| Intel is circling the drain; their revenue masks a deep
| illness, like a healthy looking person who drops dead of a
| heart attack at a party. I do think there's a chance
| Gelsinger can convince the company to turn around. They do
| have a lot to work with, despite having squandered many many
| opportunities.
|
| Why do I say sickness?
|
| - Most of their revenue comes from a single product line;
| every BU reported a revenue decline last year except
| mobileeye (small) and CCG.
|
| - Their parts are not broadly competitive on performance/W
| nor raw performance except in diminishing subsectors.
|
| - They have no presence in the largest growing sector:
| mobile.
|
| - Oh, that "eye-popping" $20B investment in fab over the next
| three years? TSMC plans to invest _$100B_ in the same period!
|
| Now the Intel of old could probably have pulled out of these
| problems, but let's look how they got here:
|
| - They have historically been a fab powerhouse, with process
| years ahead of the competition. But they have repeatedly
| missed their own milestones for smaller node size and are now
| (relatively behind or even far behind). They've had to throw
| in the towel repeatedly over the past few years in this area.
|
| - They've spent time fiddling at the edges (e.g. depth
| cameras) pouring money into new businesses and then dropping
| them. Not a bad idea when you need growth and should
| diversify your revenue stream (look at my first point above)
| but terrible if you have a 100% whiff rate.
|
| - Of those whiffs above they have had some bad ones, like
| radio chipsets, when they earlier had said they were counting
| on them.
|
| - Their architecture appears to be inappropriate for
| mobile/low power. This is a self-own. They not only had for
| its time the fastest ARM product line (StrongARM, from the
| DEC acquisition) but threw it away because they were focused
| on their high-margin quasi-monopoly x86 line.
|
| - Their partners (Microsoft, Dell, etc) are enthusiastically
| exploring ARM and Intel at the moment has no counter.
|
| - Their "only the paranoid survive" culture is gone; business
| decision making has been slow and lazy for more than a
| decade.
|
| - They are heavily dependent on their partners. If there is a
| phase change in the market (MS finally ships a decent ARM
| Windows, Dell produces a decent ARM laptop that runs it),
| well, bye bye a big chunk of CCG revenue. They could save
| some share by slashing price, but it's still terrible.
|
| This is why I said it's near death.
| vlovich123 wrote:
| Intel has ~23 billion in cash reserves [1]. MSFT in the
| 2000s (when lots of people were proclaiming their death)
| had cash reserves of ~40 billion [2]. Microsoft came back
| to compete with Apple as the most valuable company. Apple
| was far closer to death & managed to come back. AMD was
| routinely having problems competing & managed to stay in it
| enough to come back as the x86 leader.
|
| Does Intel have a problem? Yes. They know it too. I think
| you're overlooking how long a runway $20 billion buys you
| though to correct things & try different strategies. It's
| also ignoring the huge push within the US government to
| subsidize silicon manufacturing in the US for political &
| security reasons, of which Intel will be a huge
| beneficiary. I fully expect in 15 years Intel will still be
| a very valuable independent company with a market cap
| larger than today.
|
| [1]
| https://www.macrotrends.net/stocks/charts/INTC/intel/cash-
| on... [2] https://money.cnn.com/2002/04/12/pf/agenda_msft/
| dev_tty01 wrote:
| I agree that they will probably turn it around, but their
| annual operating expenses are about $20 billion. $23
| billion in reserves is not much runway with that burn
| rate if sales continue to drop. They've got a tough task
| ahead to get back on a substantial growth curve.
| ac29 wrote:
| > if sales continue to drop
|
| Intel's sales have increased every one of the past 4
| years (which is all the data this site shows): https://ww
| w.marketwatch.com/investing/stock/intc/financials/...
| gumby wrote:
| Yes but look at the segment breakdown:
| https://www.intc.com/news-events/press-
| releases/detail/1439/...
| ac29 wrote:
| Q42020 wasnt great, but for the year only two of their
| segments were down in revenue, the IOT group and the PSG
| group (looks like FPGA type stuff). Those were also two
| of the three smallest groups.
|
| I dont think Intel is necessarily going to have an easy
| next few years, but they are still a massive company who
| is growing every year.
| gumby wrote:
| $23B is nothing to sneer at but they're going to put $20B
| into fabs (while TSMC puts in $100B). Their revenues are
| also significant but again,mits essentially all from CCS,
| a declining sector under attack. I hope they make it and
| they do have resources to put to work, but the odds are
| against them.
|
| Your rose coloured glasses come from survivorship bias.
| Apple was a magical story, true. AMD made it but is a
| tiddler by comparison. Based on history, they're going to
| need abnormally good luck.
| vlovich123 wrote:
| If you're certain my position is so ridiculous, care to
| make a wager for cash?
| KirillPanov wrote:
| That's like the Internet version of challenging him to a
| duel.
|
| _I demand satisfaction, sir! Emails at twenty paces. No
| IRC allowed._
| gumby wrote:
| I use text only email for combat.
|
| Not as clumsy or random as HTML or MIME; an elegant
| weapon for a more civilized age.
| agustif wrote:
| I've been seeing this for years from irc to forums to
| well, hn.
|
| Maybe it could make a great blockchain/nft startup.
| DuelUp, put your money where your mouth or in this case
| (words in text) are.
|
| heh
| gumby wrote:
| Well I have -- haven't owned INTC for a long time and
| don't own much Intel hardware now either.
|
| More to the point: I would like Intel to succeed but they
| face long odds. Looking at localized data like top line
| revenue ignores secular shifts that have been moving
| against them, and to which they have so far been
| demonstrably unable to respond.
|
| Looking at just the top line is like deciding how your
| journey is doing based on your current speed. It's an
| input but tells you almost nothing on its own.
| MangoCoffee wrote:
| Is it easy to port a design over and start pumping out chips on a
| totally different process?. Is it easy to reconfigure an Intel
| "optimized" production line? Intel only make chips for
| themselves. Can they reconfigured their fabs to use standardized
| tool such as EDS software that most fabless and fab use? how long
| would it take?
| CapriciousCptl wrote:
| Since these chips presumably don't need 5nm does this mean Intel
| can use its old lithography machines? That might otherwise be
| collecting dust or something?
| abductee_hg wrote:
| how about they make a mobile chip that doesn't suck first?
|
| the 2013 BMW ... if you got the big headunit you had to also get
| the big AC... why?
|
| there was an extra hose from the AC to the headunit... why?
|
| intel ATOM. that's why.
| michaelt wrote:
| Automotive companies love doing this.
|
| Oh, you want auto-park? We bundle that with our premium
| loudspeakers, it's the "advanced technology pack". Keyless
| entry? We bundle that with the heated steering wheel.
| teddyh wrote:
| And high beam assist:
|
| https://twitter.com/_jakegroves/status/1374872023596417024
|
| https://twitter.com/_jakegroves/status/1375002783103995904
| paxys wrote:
| I bet the engineers at Intel who just found out about this
| through the public announcement and now have to figure it out are
| thrilled.
| schraeds wrote:
| Sounds like the natural progression of their Foundry Service
| announcement from a few weeks ago.
| ggm wrote:
| Philips (NL) is going to have a spectacular financial year
| outcome, I believe they make a lot of fab line equipment. And
| anyone else in the space. Europe used to make the things, moved
| to making the things which make things.
|
| If not philips somebody like philips.
| hkmurakami wrote:
| You're probably thinking of ASML. They have indeed done great!
| [deleted]
| ggm wrote:
| Yes. according to the company history web page, co-founded by
| Philips, who sold down in the 90s and following years sold
| out.
|
| https://www.asml.com/en/company/about-asml/history
|
| 29% ROI Year to date. nearly 500% on 5 years.
| Avalaxy wrote:
| If Philips would have held on to all the successful
| companies they spun off, they would now be worth 5 times as
| much. They were also one of the largest shareholders of
| TSMC when they started.
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