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Taiwan Semiconductor Manufacturing Company is ramping up its investments in the United States, announcing on Tuesday that it will build a second semiconductor fab in Arizona and increase its investment there from $12 billion to $40 billion. The move is one of the “largest foreign direct investments in United States history,” according to the company.
TSMC’s plans come as tensions between Washington and Beijing over chips rise and President Joe Biden has broad control over sales of advanced chips and chip-making equipment to Chinese firms.
Biden visited the manufacturer’s Phoenix location and spoke about bringing jobs and investment to the state. Other lawmakers and business leaders also attended the event, including Apple CEO Tim Cook.
“As many of you know, we work with TSMC to create the chips that power our products around the world, and we look forward to expanding that work in the years to come as TSMC finds new and deeper roots in America educates,” Cook said during the event, adding that with the opening of the new facility, Apple’s own silicon chips “can be proudly stamped ‘Made in America.’
TSMC previously announced that it is building a $12 billion facility in Arizona that will eventually manufacture 3-nanometer chips, TSMC’s most advanced technology. Between the two factories, the state will add thousands of “high-paying, high-tech jobs” and produce 600,000 wafers a year, the company said.
TSMC accounts for an estimated 90% of the world’s advanced computer chips and supplies technology giants such as Apple (AAPL) and Qualcomm (QCOM).
Chips are an essential part of everything from smartphones to washing machines – but are also difficult to manufacture due to the high development costs and level of knowledge required, meaning much of the production is concentrated with a handful of suppliers.
The White House is touting the new investments as a direct result of Biden’s economic plan, including the $200 billion CHIPS and Science Act. Biden has visited communities where companies like TSMC and Intel have announced new investments since the bill passed this summer.
“It means more workers in these big factories, but it also means more opportunities for suppliers and contractors, well-paying construction jobs, opportunities for small and medium-sized manufacturers and suppliers,” Brian Deese, director of the National Economic Council, told reporters on Monday. “It represents an economic opportunity for communities often left behind in economic cycles, including traditional energy communities that have powered our nation for generations and tribal nations.”
Global chip shortages first emerged at the onset of the pandemic, which has upended supply chains and transformed consumer shopping behavior. Automakers reduced orders for chips, while tech companies, whose products have been boosted by lockdown life, bought as many as they could.
The facility, which Biden will visit in Phoenix on Tuesday, is scheduled to start producing chips in 2024. The new plant is scheduled to start production in 2026.
– CNN’s Nikki Carvajal, Wayne Chang and Diksha Madhok contributed to this report.