A seismic shift is underway in the U.S. semiconductor industry. Nvidia has announced a $5 billion investment for a nearly 5% stake in Intel, transforming the two former rivals into allies. The companies will collaborate on developing custom x86 CPUs and data center platforms. This marks the third major capital injection into Intel, following investments from the U.S. government and SoftBank. Observers interpret this move as an extension of the Trump administration’s push to create a “national chip team.”
TSMC’s Position Secure in the Short Term; Long-Term Concerns Warrant Observation
Chih-Yen Tai, an Associate Research Fellow at the Chung-Hua Institution for Economic Research (CIER), analyzed that Nvidia’s investment in Intel helps mitigate risks from insufficient packaging capacity. It also provides Nvidia with greater policy leverage amid the U.S.-China technology rivalry. The move could even aid in future efforts to relax export controls. For Intel, the investment alleviates capital pressures and opens up new opportunities. However, without long-term orders from major clients, the $5 billion infusion may be a “drop in the bucket.” It is unlikely to resolve the company’s struggles with lagging yields in advanced manufacturing processes.
Regarding the impact on Taiwan, Kristy Hsu, Director of the Taiwan ASEAN Studies Center (TASC) at the CIER, believes TSMC will face no immediate impact. She noted that TSMC’s production capacity, both in the United States and Taiwan, remains nearly unrivaled in quality and yield. However, a long-term concern is whether the Trump administration will pressure TSMC to invest in Intel or use policy to prioritize American domestic companies. As the trend of U.S.-China decoupling deepens, the risk of supply chain restructuring grows. Taiwan must continue to strengthen its technological advantages and maintain international cooperation to secure its critical position in the global semiconductor industry.
Sneakflation Highlights Price Pressures; Taiwan Must Enhance Semiconductor’s Indispensable Role
Core inflation in the U.S. has remained persistently high in recent months. While the prices of some daily essentials have not risen sharply, companies are passing on costs through “sneakflation”—reducing package sizes or product quantities—creating a hidden burden for consumers.
Jiann-Chyuan Wang, Vice President of the CIER, noted that “sneakflation” in the U.S. highlights global price pressures and a structural shift in consumption patterns, while the NVIDIA-Intel alliance reflects the shifting power dynamics of supply chain restructuring. Taiwan must remain vigilant about the challenges that inflation and demand adjustments pose to its export markets while leveraging its semiconductor advantages to maintain its indispensable position in the international supply chain.
Author: CIER Editorial Team Date: September 22, 2025