US Govt Makes Largest Foreign Direct Investment Ever in TSMC

Taiwan Semiconductor Manufacturing Company (TSMC) will receive $6.6 billion in direct funding and an additional $5 billion in government loans to expand its semiconductor production facilities in Phoenix, Arizona, US.

This marks the first major contract under the U.S. CHIPS and Science Act, announced by the Department of Commerce in April. The funding, tied to project milestones, will begin with an initial $1 billion disbursement expected before year-end.

TSMC has committed to a total investment of $65 billion in its Arizona plants, representing the largest foreign direct investment project in U.S. history. Here is a statement from US President Joe Biden:

The first of TSMC’s three facilities is on track to fully open early next year, which means that for the first time in decades an American manufacturing plant will be producing the leading-edge chips used in our most advanced technologies – from our smartphones, to autonomous vehicles, to the data centers powering artificial intelligence.

TSMC’s Arizona plants are slated to begin 4nm chip production next year, followed by 3nm chips in 2026 using N2 and A16 nanosheet technologies. The company also plans to open a third Arizona factory by 2030, focused on producing 2nm chips.