After months of procrastination, TSMC's 3nm process node finally went into mass production at the end of last year. Its quotation exceeded $20000, which is $4000 higher than the 4nm/5nm contract price. This has also deterred many customers, leaving TSMC's first generation N3 process with only Apple, monopolizing all production capacity. Samsung and Intel both strive to catch up with and surpass TSMC in the field of Foundry model, but TSMC is still in the absolute leading position, winning most 3nm orders in the market, and also began to negotiate 2nm cooperation.

        On June 27th, according to DigiTimes, the 2nm contract price of TSMC is close to $25000, which is about 25% higher than the current 3nm contract price. TSMC will use GAAFET (Gate All Around FET) architecture transistors for the first time in the 2nm process node, relying on existing extreme ultraviolet (EUV) lithography technology.

        Industry insiders have stated that after entering the 7nm process node, the prices for advanced processes are getting higher and higher. TSMC's 6/7nm contract price is close to $10000, the 4/5nm contract price is about $16000, and the 3nm contract price has reached $20000. In addition to the largest customer Apple, only a few manufacturers with sufficiently large order sizes can receive discount discounts.

        Although there have been continuous reports of yield and efficiency issues, TSMC has the advantage of supply and negotiation, and many IC design companies can only "close their eyes" to place orders. At present, there are fewer and fewer customers who have sufficient funds and product requirements to place orders at the 2/3nm process node, and these customers have established long-term cooperative relationships with TSMC.

        According to TSMC's schedule, the N2 process is expected to prepare for risky production by the end of 2024 and enter mass production by the end of 2025. Customers will receive the first batch of 2nm chips by 2026.

        Due to the difficulty of major manufacturers such as Samsung and Intel in "overtaking on curves" within a few years, TSMC has a leading advantage. Like the 3nm process node, TSMC is expected to win most of the orders from large chip design companies, almost sweeping away orders from major chip manufacturers, and will usher in a new wave of growth starting from 2024.

        For 2nm wafers priced close to 25000 yuan, there are fewer and fewer customers with available products and financial resources, but these customers have already established long-term cooperative relationships with TSMC. Industry insiders said that because TSMC's OEM quotation has always been high, coupled with inflation and other factors, the quotation of new products this year will continue to rise. For example, Nvidia's GPU for games, AI, Apple's new iPhone, etc., the "high price positioning" of these products has not returned. These costs will be passed on to downstream customers, reflected in the price of terminal equipment.

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