TSMC will remain the only chip supplier for iPhone, could provide ARM-based chips for Mac in 2020 and Apple car chips in 2023

Taiwan Semiconductor Manufacturing Company or TSMC is expected to remain one of Apple's leading suppliers in the coming years, according to an investor note released today by renowned analyst Apple Ming-Chi Kuo, who now works for TF International Securities.

TSMC manufactures the A-series chips used in Apple iPhones. The company is Apple's only supplier for iPhone chips in recent years and will remain Apple's only supplier in 2019 and 2020 for the A13 and A14 chips that Apple should use in these devices.

According to Kuo, Apple will increasingly depend on TSMC in the coming years because of its "superior design and production capabilities" compared to its competitors and the fact that TSMC, unlike Samsung and other Apple suppliers, does not does not compete with Apple markets.

Kuo believes that TSMC will manufacture Apple-based ARM-based processors for Mac models from 2020 or 2021 in the future. According to rumors, Apple plans to move Intel chips to its own custom chips by 2020, said Kuo. that Kuo reiterates in today 's report.

The custom-designed Mac chips have many advantages, including the lack of delay due to Intel's manufacturing issues, better profits, increased control over the design and differentiation of competing products.

We also expect Mac models to adopt Apple-designed processors from 2020 or 2021, which will create four benefits for Apple: (1) Apple could control everything from Mac design and production to getting rid of negative impacts of Intel processor shipping schedule changes. (2) Better profits thanks to the reduced cost of the processor. (3) Mac's market share increases if Apple lowers the price. (4) This could differentiate Mac products from their peers' products.

Kuo also suggests that Apple will recruit TSMC for chip manufacturing for its next Apple car from 2023-2025.

We believe that Apple Car Advanced Driver Assistance Systems (ADAS) will support level 4 (advanced automation) or level 5 (full automation). Only TSMC's 3/5 nm process can meet the requirements of the Level 4 and 5 chips.

In a report released in August, Kuo announced that Apple would launch a complete Apple Car between 2023 and 2025, thus reviving rumors about Apple's work on a complete vehicle. Before this report, Apple thought it had set aside its vehicle projects and focused solely on autonomous driving software that could eventually be integrated into the vehicles of its partners.