Taiwan's TSMC to build Arizona chip plant

Taiwan's TSMC to build Arizona chip plant

Taiwan Semiconductor Manufacturing Co Ltd , the biggest contract chipmaker, said it plans to build a $12 billion factory in Arizona in an apparent win for the Trump administration's efforts to wrestle global tech supply chains back from China.

Ciara Lee reports

There was good news on Friday (May 15) for the Trump administration's bid to wrestle global tech supply chains back from China Taiwan Semiconductor Manufacturing Company announced its plan to build a $12 billion factory in Arizona, creating over 1,600 jobs.

It comes as U.S. President Donald Trump steps up criticism of Chinese trade practices and Beijing's handling of the pandemic.

Secretary of State Mike Pompeo said in a statement early Friday that the investment will increase U.S. economic independence from China.

TSMC, the world's biggest contract chipmaker, is a major supplier to U.S. tech giants Apple and Qualcomm.

It also supplies Chinese firms like Huawei, which Washington has put on a trade blacklist.

While huge in terms of foreign investment in the U.S., the plan is small by TSMC's standards.

One analyst said the budget suggests the eventual scale won't be big.

Another said it's "similar to what TSMC did in China, suggesting a balance between the U.S. & China." TSMC manufactures the bulk of its chips in Taiwan and has older chip facilities in China and Washington state.

Semiconductors play a key role in both consumer electronics and defense equipment.

Pompeo said chips from the new TSMC plant will power everything from AI to 5G base stations to F-35 fighter jets.

TSMC said that construction of the Arizona facility would begin in 2021 with production targeted to start in 2024