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The White House has reached a preliminary agreement with Taiwan Semiconductor Manufacturing Corporation (TSMC) to help fund its US expansion. Under the agreement, TSMC will build a third chip manufacturing plant in Arizona and create an estimated 25,000 jobs, according to a White House press release published Monday.
The chipmaker is expected to receive roughly $11.6 billion in total US government funding, with $6.6 billion of that as grants and the remaining $5 billion as loans, a TSMC post states. This would bring the company's total Arizona investments to $65 billion, as it already has two Arizona plants in the works that are expected to begin production in 2025 and 2028. The third factory will begin making advanced chips "by the end of the decade," TSMC says.
TSMC's US funding—like Intel's recent $8.5 billion award—is thanks to the 2022 CHIPS and Science Act, which aims to make the US globally competitive when it comes to chip-making.
“The CHIPS and Science Act provides TSMC the opportunity to make this unprecedented investment and to offer our foundry service of the most advanced manufacturing technologies in the United States,” said TSMC Chairman Mark Liu in a statement. “Our US operations allow us to better support our US customers, which include several of the world’s leading technology companies. Our US operations will also expand our capability to trail-blaze future advancements in semiconductor technology.”
TSMC makes computer chips for firms like Apple, Nvidia, AMD, and Qualcomm. It's an important player in the semiconductor space alongside Intel and Samsung. TSMC briefly halted production in Taiwan earlier this month when a 7.4-magnitude earthquake shook the country.
The White House wants the US to be making 20% of the world's most advanced chips by 2030—but it doesn't want those chips sold to China. The US sees China as a main competitor, and has banned high-tech AI chip exports to the country. China reportedly tried to get around the restrictions, but has since begun phasing out Intel and AMD chips from its government computers. It's unclear whether China's tense relationship with Taiwan could impact TSMC's US chip manufacturing in the future, however.
Samsung is also spending billions to manufacture and package chips in the US, investing $44 billion in its Texas plants. Like Intel and TSMC, Samsung is also expected to receive "billions" in US federal funding as part of its plans, The Wall Street Journal previously reported.