Mehul Reuben DasDec 07, 2022 13:43:48 IST
Taiwan’s TSMC or the Taiwan Semiconductor Manufacturing Co Ltd. announced on Tuesday that they will be tripling their planned investment at the Arizona plant in the US to a total of $40 billion. US President Joe Biden, who visited the TSMC plant in Arizona, hailed the project as it emerges as one of the largest foreign investments in US history.
“American manufacturing is back, folks,” Biden said in a speech against the backdrop of the new factory draped with an American flag and a large banner reading “A Future Made in America Phoenix, AZ.”
The expanded investment is a big win for Biden after supply chain issues disrupted the U.S. economy early in his presidency. TSMC also plans to open up a second facility, another fabrication plant to produce 3-nanometre chips by the end of 2026.
Mark Liu, the chairman of TSMC estimates to have an annual revenue of $10 billion when the two planned chip fabrication plants open, adding that customers would have annual sales of $40 billion from products using chips made there.
Three of TSMC’s largest customers, Apple Inc, NVIDIA Corp and AMD Inc, have stated that they expect to source most of their upcoming chips from the American plants of TSMC.
Apple meanwhile, has stated that going forward, they will only be using chips that have been made at an American TSMC plant. Speaking at the event, Apple’s CEO Tim Cook said, “We work with TSMC to manufacture the chips that help power our products all over the world. And we look forward to expanding this work in the years to come as TSMC forms new and deeper roots in America.”
Biden has sought to boost semiconductor production after the pandemic caused supply chain problems that led to shortages of chips for vehicles and many other items.US’ semiconductor production accounts for just 12 per cent of the global total, down from 37 per cent two decades ago.
Taiwan’s dominant position as a maker of chips used in technology from cellphones and cars to fighter jets has sparked concerns of over-reliance on the island, especially as China ramps up military pressure to assert its sovereignty claims.