WASHINGTON, D.C. – In a landmark announcement, the leading Taiwanese semiconductor giant, TSMC, has pledged a staggering $100 billion investment in the United States. The plan outlines the construction of five additional chip factories in a strategic move spearheaded by CEO C.C. Wei, alongside former U.S. President Donald Trump.
During a meeting at the White House, Wei and Trump highlighted the critical need for the U.S. to bolster its domestic semiconductor production. ‘It’s about national security,’ Trump emphasized, pointing to the necessity for homegrown chips and semiconductors.
The expansion strategy includes the development of three new chip fabrication facilities, complemented by two advanced packaging sites and a comprehensive R&D center. This bold outlay intends to diminish the U.S.’s dependency on Asian semiconductor supplies, aiming to fortify national economic resilience.
Building on its previously declared investment, which reached $65 billion with an additional $25 billion committed last April, TSMC plans to introduce a third factory in Arizona by 2030. Although exact dates for the new investments remain undisclosed, the initiative is set to create 40,000 jobs within the construction sector over the next four years. The company is targeting 2024 for chip production commencement in its initial Arizona plant, despite prior delays and elevated construction costs compared to its Taiwanese operations.
However, news of the investment had an immediate impact on TSMC’s shares, which dropped 2.25% on Tuesday morning amidst concerns about escalating production costs.
As the principal chip supplier for major U.S. companies like Nvidia, Qualcomm, and AMD, TSMC’s increased U.S. presence aims to alleviate supply chain vulnerabilities. Additionally, the firm could play a pivotal role in reviving competitor Intel, as discussions continue about potential joint ventures in U.S.-based semiconductor facilities.
This significant development underscores Trump’s efforts to fulfill promises of enhancing domestic manufacturing and job creation. Other technological giants like Apple, and prominent investors, including Hussain Sajwani and SoftBank, have echoed this trend with multi-billion dollar U.S. investments.
The Taiwanese government’s review of TSMC’s overseas investment aligns with its legal requirements, with Taiwanese Premier Cho Jung-tai affirming the beneficial nature of such global ventures for Taiwan’s competitive edge. He emphasized Taiwan’s vital partnership with the U.S. in the tech sector.
Reflecting on the historical partnership, the initial Trump administration’s initiatives such as bringing TSMC to Arizona and the introduction of the CHIPS and Science Act aimed at supporting domestic semiconductor research and production have paved the way for such substantial investments. The CHIPS Act, which passed under President Biden, has authorized $52.7 billion for American semiconductor industries, further incentivizing TSMC’s massive contribution.