Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest chipmaker, has announced plans to invest “at least” 100 billion US dollars in the United States over the next four years as part of expanding its chip factory network.
This announcement came on Monday, March 3rd, during a news conference by President Trump. TSMC Chairman and CEO, Mark Liu, mentioned that the company will be constructing new factories in Arizona.
“We will be producing many AI chips to support the development of artificial intelligence,” Liu said.
TSMC’s expansion plan includes the construction of three new chip manufacturing plants, two advanced packaging facilities, and a large research and development center.
President Trump also stated that this investment will involve building two high-end chip manufacturing plants in Arizona, aiming to create tens of thousands of job opportunities.
Previously, TSMC had committed to investing 65 billion US dollars in US manufacturing plants and had received up to 6.6 billion US dollars in government grants from the Chip Act, a significant law passed by the Biden administration to promote domestic chip production.
During the news conference, President Trump announced that this new investment would bring the company’s total investment in the US chip industry to around 165 billion US dollars.
For years, the US has expressed concerns about TSMC’s near monopoly in the chip manufacturing sector and had urged the company to shift more production to the US. TSMC’s expertise in advanced chip packaging is particularly important for AI chips, as the demand for AI chips has significantly increased with the rise of artificial intelligence.
Since taking office, President Trump has expressed his intentions of imposing tariffs on foreign chip production to bring chip manufacturing back to the US.
“This is a major move by the world’s most powerful company. It’s about economic security and, for us, it is a national security issue as well,” Trump stated on Monday. He noted that this move would also help TSMC diversify and no longer be solely dependent on chip manufacturing in Taiwan.
Chips produced by TSMC power numerous technological products, including iPhones, AI systems, cars, and medical equipment.
Trump stated that TSMC’s investment, along with “other investments we are making,” could potentially increase the US’s share in the global chip manufacturing market to 40%. However, these goals often take several years to achieve.
During a White House event, Mark Liu mentioned, “We will be producing many chips to support the development of artificial intelligence and smartphones.” He also thanked TSMC customers in the US like Apple, NVIDIA, AMD, and Qualcomm.
US Commerce Secretary, Howard Lutnick, mentioned during a press conference that TSMC’s additional investment is closely related to the US industrial subsidy and tariff policies.
By April 2024, TSMC’s total investment in the US reached 65 billion US dollars. The US has provided approximately 6.6 billion US dollars in government subsidies, following the Chip Act, to support construction of three factories planned in Phoenix.
Lutnick stated that TSMC’s investments in the US not only cater to the world’s largest consumer market but also help in avoiding tariffs.
TSMC is the world’s largest contract chipmaker, with its most advanced facilities traditionally held in Taiwan.
Due to increasing threats from China, the US considers TSMC’s significant presence in Taiwan as a strategic risk.
Reports indicate that the US government has urged TSMC to take over and manage Intel’s chip factories in the US, which have been troubled by logistics challenges.
President Trump has publicly stated multiple times his intentions to impose tariffs on imported chips, including those from Taiwan.
Daniel Newman, CEO of technology consulting firm Futurum Group, mentioned through email to TechCrunch that he expects TSMC’s investment to be linked to the US’s delayed tariffs or depend on meeting specific US requirements.
He believes that this will be a “win” for the US government.
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