TSMC to Manufacture Advance Node Semiconductor’s in the U.S.

Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading-edge chip manufacturer, announced their plan for a $40 billion expansion of their U.S. manufacturing hub in Phoenix. The company plans to announce their plan to triple their original plans of a $12 billion investment and the new fab construction during President Biden visit.   

The enhancements would allow the Arizona factory to produce advanced 4-nanometer chips used in Apple iPhones and other smart devices in 2024. Additionally, TSMC founder Morris Chang said the company was planning to produce chips with advanced 3-nanometre technology in the Arizona plant as well but added that the plans were not yet finalized.  

The move is to hedge against geo-political risks especial due to tensions mounting with China and was prompted by TSMC’s customers including Apple, AMD and Nvidia. 

Taiwan minister denies that TSMC’s American plant will chip away at their semiconductor dominance dismissing speculation that TSMC’s plans for a production base in Arizona were a result of strong US pressure. “First, I can say emphatically that there is no such deal and second, there is no such issue as de-Talibanization of our semiconductor industry,” Wu said in response to queries by Chiu Chen-yuan, a legislator of the opposition Taiwan People’s Party, during a legislature meeting in Taipei blaming China for spreading such fear within Taiwan.  

President Biden plans to note that the new TSMC investments were encouraged by the passage of the CHIPS & Science Act which enables companies such as TSMC to receive federal subsidies for technology innovation and manufacturing under that legislation. 

Last week, President Biden toured a $300 million SK Siltron CSS facility in Bay City, Michigan. The South Korean SK Group conglomerate facility will manufacture electric vehicle components.  

During that visit President Biden also tied the project directly to the CHIPS and Science Act, which he signed in August and said, "Instead of relying on chips made overseas in places like China, the supply chain for those chips will be here in America …. The difference is going to be, we're going to make that supply chain available to the rest of the world, and we're not going to be held hostage anymore." 

TSMC’s upgraded plan as well as all the other semiconductor fab investments within the U.S. demonstrates how geopolitical concerns are causing companies and governments to modify their longtime strategies that led them to shift most semiconductor manufacturing to Asia. It also underscores the importance of semiconductors, new technologies and their manufacturing to the global economy and the U.S. and other government military securities. Underscoring the importance for companies to understand their technology value chain.