Taiwan Strait: TSMC Disruption Cascade

Disruption cascade model simulating TSMC output failure across 17,900+ supply chain edges. Evaluates hyperscaler impact based on current-node reliance and inventory buffers across four parameterized scenarios.

Taiwan's dominance of advanced fabrication concentrates global AI capability at a single node. This assessment quantifies how TSMC output changes reshape downstream access for US and allied AI development under blockade, strike, and embargo scenarios.

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Supply Chain Exposure Analysis

Taiwan Strait Scenario: TSMC Disruption Cascade

6 TSMC fabs, 5 alternative foundry sites. Cascade propagation across 17,900+ supply chain edges; substitution gap 85-95% for advanced process node capacity. Active: Naval BlockadeTaiwan manufactures over 90% of the world's most advanced AI chips. Four disruption scenarios model how that concentration translates to downstream risk. Active: Naval Blockade

Disruption Scenario

Over 90% of advanced-node chip fabrication (sub-5nm) occurs at TSMC facilities in Taiwan. No combination of alternative foundries can replace this capacity within 3-5 years.

TSMC Fabs

Alt. Foundries

95%

Severity

Weeks

Impact

Market Concentration (HHI)

Advanced Logic (<7nm)HHI: 8,528

TSMC: 92%Samsung Foundry: 8%

TrendForce Q4 2024 Foundry Market Share (trendforce.com/presscenter/news/20250310-12510.html) · Tier 2 · estimated

Total Foundry Revenue (Q4 2024 TrendForce)HHI: 4,661

TSMC: 67%Samsung Foundry: 8%GlobalFoundries: 6%UMC: 6%SMIC: 6%

TrendForce press release March 10, 2025: Q4 2024 top-10 foundries combined $38.48B, TSMC $26.85B (trendforce.com/presscenter/news/20250310-12510.html) · Tier 2 · estimated

EUV Lithography SystemsHHI: 10,000

ASML: 100%

ASML 2024 Annual Report (asml.com/investors) · Tier 1

AI Accelerator FabricationHHI: 9,608

TSMC: 98%Samsung Foundry: 2%

Qualitative analyst consensus from chip-level fabrication data; no primary source publishes AI accelerator fab share as a figure · Tier 4 · estimated

Supply Chain Cascade Simulation

Propagate Naval Blockade through supply chain graph

Critical Customer Dependencies

Applecritical

A-series (iPhone), M-series (Mac), S-series (Watch)

All iPhone/Mac/iPad production halts. Apple has NO alternative foundry qualified for its chip designs.

NVIDIAcritical

H100, H200, B200, B300, Grace CPU, Drive Orin

All AI GPU production halts. NVIDIA designs are TSMC-exclusive at advanced nodes. No Samsung/Intel qualification exists for datacenter GPUs.

AMDcritical

EPYC (datacenter CPU), MI300X/MI325X (AI GPU), Ryzen (consumer)

All datacenter GPU and CPU production halts. AMD previously used GlobalFoundries but moved to TSMC for advanced nodes.

Qualcommhigh

Snapdragon mobile SoC, Snapdragon X Elite (PC), Auto platforms

Most flagship mobile SoC production halts. Some older products on Samsung, but flagship Snapdragon 8 Gen 3 is TSMC-exclusive.

Broadcomhigh

Networking ASICs, Custom AI accelerators (Google TPU), WiFi/BT

Data center networking silicon halts. Google TPU (designed by Google, fabbed by Broadcom via TSMC) production stops.

MediaTekhigh

Dimensity mobile SoC, Smart TV chips, WiFi/BT

Largest TSMC customer by unit volume for mid-range mobile chips. Android ecosystem severely impacted.

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Cascade SimulationChokepoint Analysis

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Supply ChainInfrastructure

Explore the supply chain edges this assessment traces

Chokepoint AnatomyChokepoint Analysis

TSMC concentration in advanced logic fabrication