TSMC to Build $12 Billion Chip Fab in Arizona

Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, announced plans in May 2020 to build a $12 billion semiconductor fabrication plant in Phoenix, Arizona — its first advanced-logic fab in the United States. The facility, expected to create more than 1,600 full-time jobs, will manufacture 5-nanometer chips using extreme ultraviolet (EUV) lithography, a significant break from TSMC's practice of keeping its most advanced processes in Taiwan.

The announcement followed an agreement with the U.S. government over subsidies and incentives, and came as Washington grew increasingly concerned about the concentration of global chip production in East Asia. According to the Semiconductor Industry Association, the U.S. share of global semiconductor manufacturing capacity had fallen from 37 percent in 1990 to just 12 percent.

TSMC founder Morris Chang said the Arizona plant would initially account for only a small share of the company's output, but the move marked the beginning of a much larger onshoring wave. The fab broke ground in 2021, and the investment was later expanded several times — eventually growing into a $165 billion "gigafab" cluster with six planned fabs, two advanced packaging facilities and an R&D center, the largest greenfield foreign direct investment in U.S. history.

Source: TSMC press release, May 2020; coverage by Reuters and Arizona Republic. Reference: TSMC Arizona — Wikipedia