Editor's take: A potential Intel-TSMC partnership could end up reshaping global supply chains in the semiconductor sector. However, the actual effects will depend on the specific terms of any agreement and how successfully the collaboration is implemented. A potential partnership between Intel and TSMC is being discussed that, if realized, could reshape the global chip manufacturing landscape and address ongoing concerns about the concentration of advanced chip production in Asia.According to an analyst note from Baird, discussions are underway regarding a possible arrangement in which TSMC would send engineers to one of Intel's advanced chip factories. The purpose of this collaboration would be to apply TSMC's expertise and ensure the viability of Intel's manufacturing processes.The proposed partnership could take an even more substantial form, with the possibility of spinning off the factory into a new entity jointly owned by Intel and TSMC. This new venture would be operated by TSMC and could potentially receive funding from the US CHIPS Act.However, it's important to note that these discussions are still in the preliminary stages. The analyst report emphasizes that there is no confirmation of the deal, and if it were to move forward, the process could be lengthy. // Related StoriesStill, it is easy to imagine how a potential partnership between Intel and TSMC could significantly reshape the global chip market. By combining Intel's infrastructure with TSMC's expertise, Intel's position in advanced chip manufacturing would strengthen, narrowing the technological gap with TSMC. This would provide major tech companies with a viable alternative for leading-edge semiconductor production, diversifying the supply chain. This collaboration could also intensify competition in the chip manufacturing space, potentially leading to more competitive pricing and increased innovation.However, these outcomes are only speculative and based on rumored discussions. The actual impact on the global chip market will depend on the specific terms of any agreement and the successful implementation of the partnership.The potential Intel-TSMC partnership comes against the backdrop of increasing US government focus on domestic chip production. President Trump has been vocal about his desire to bring semiconductor manufacturing back to the United States.While on his campaign trail, Trump has accused Taiwan of "stealing" the US chip business, referring to TSMC's dominant position in producing leading-edge chips for major tech companies like Apple and Nvidia. He expressed dissatisfaction with the current state of affairs, where a significant portion of advanced chip manufacturing occurs in Taiwan.To incentivize the relocation of chip manufacturing to the US, the Trump administration has proposed imposing tariffs as high as 100 percent on foreign-made processors. This move has raised concerns about potential price increases for consumers, though Trump argues that any short-term disruptions would be outweighed by long-term benefits to the US economy.In response to these developments, TSMC has already taken steps to increase its US presence. The company has approved an additional $17 billion in funding to boost its chip production, with a portion of this investment directed towards its operations in the United States.