In a significant move to revitalize American semiconductor manufacturing, Taiwan Semiconductor Manufacturing Company (TSMC), the world’s premier chipmaker, saw its shares surge by up to 3.2% following an announcement from President Joe Biden’s administration. The administration has earmarked nearly $12 billion in a mix of grants and loans, propelling TSMC’s stock to an intraday peak of $145.92. This financial infusion is a strategic component of the CHIPS and Science Act passed in 2022, underscoring a concerted push to secure and bolster the US’s position in the global semiconductor arena.
TSMC’s reaction to this windfall was swift, with plans to erect a third production facility by 2028 at its burgeoning Phoenix site, in a bid to satisfy the ever-increasing demand for semiconductors within the US. This ambitious expansion, projected to exceed $65 billion in investment, is poised to be both the largest foreign direct investment Arizona has seen and the most significant greenfield project in US history.
The Department of Commerce highlighted that TSMC’s expansion would not only invigorate the US tech giants like AMD, Apple, Nvidia, and Qualcomm by powering their operations but also significantly contribute to the job market. With the completion of all three facilities, an estimated 6,000 high-tech roles and 20,000 construction jobs are expected to be created, reinforcing the economic ripple effect of this initiative.
President Biden lauded TSMC’s commitment as emblematic of a broader revival in American semiconductor manufacturing, supported robustly by the nation’s leading technology firms. This collaboration with Taiwan’s chipmaking powerhouse is a calculated step toward the US’s ambitious target to manufacture 20% of the world’s leading-edge chips by 2030. Furthermore, it aims to mitigate dependency on China’s high-tech manufacturing amid escalating tensions between the two global powers.
This move comes in the wake of a powerful 7.4-magnitude earthquake that rattled Taiwan’s east coast, temporarily disrupting TSMC’s operations and highlighting the critical need for diversified global manufacturing hubs to ensure supply chain resilience. With TSMC’s monumental investment and the backing of the Biden administration, the future of US semiconductor manufacturing looks brighter than ever, promising to redefine the landscape of global chip production.