TSMC secures government subsidies and picks site for $12 billion U.S. plant

TSMC (Taiwan Semiconductor Manufacturing Co. Ltd.) has secured government subsidies for a planned $12 billion U.S. chip plant to be built in Arizona. The new plant is designed to allay U.S. national security concerns and shift high-tech manufacturing to America.

TSMC secures government subsidies and picks site for $12 billion U.S. plant

Debby Wu for Bloomberg:

TSMC, the main chipmaker to Apple Inc. and Huawei Technologies Co., has picked a site for the future plant and both federal and state governments have agreed to help make up for the higher cost of fabricating semiconductors in the U.S., Chairman Mark Liu told reporters Tuesday. Negotiations continue over the specifics of those incentives, he said without elaborating or identifying the site’s location.

The decision to situate a plant in Arizona came after White House officials warned about the threat inherent in having much of the world’s electronics made outside of the U.S. TSMC had negotiated a deal with the administration to create American jobs and produce sensitive components domestically for national security reasons. It announced the project just before Washington leveled new restrictions on the sale of chips to Huawei, seeking to contain one of TSMC’s largest customers.

TSMC has set aside land adjacent to its selected plot and hopes to convince its own suppliers to set up operations in the vicinity over time, Liu added.

MacDailyNews Note: According to various reports, the location of TSMC’s new $12 billion U.S. plant will be in the Phoenix area.

6 Comments

  1. I’m not sure how the central planners’ subsidies to a foreign corporation to employ American workers to make chips for Apple and Huawei contributes to “national security”, but whatever.

    1. The article specifically says that TSMC won’t be making chips for Huawei. As for central planning, Maricopa County, Arizona is hardly a socialist paradise.

      1. No, the article doesn’t say that. It says the TSMC hopes to resolve the issue in the near future. But no matter, they will find a way around any restrictions.

        But state and federal central planning, and subsidizing TSMC is corporate socialism, and the workers and communities benefitting from the subsidies are engaging in socialism. So, if you think that Maricopa County is a paradise, then it is becoming more so through various forms of socialism.

        FWIW, I’m not against socialism in general, just corporate socialism and central planning specifically. Enough of publicizing the risk and privatizing the profits. And when you through the U.S. military in to enforce foreign policy towards Taiwan and protect TSMC, well that’s just another form of fascism.

      2. Arizona is going blue you can’t keep bad mouthing a fast growing group of people and think they are going to join up to your cause thank you Pete Wilson.

  2. Plans for a TSMC Arizona plant are in doubt as the chipmaker says it is seeking huge subsidies from the US government in order to proceed.

    Specifically, TSMC wants the US government to completely cover the difference in operating costs between Taiwan and the USA …

    Reuters reports on a brief statement made by the company’s chairman.

    Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is still in talks with the U.S. government about subsidies for its new plant in Arizona, chairman Mark Liu said on Tuesday.

    “We hope federal and state governments could make up TSMC’s running costs difference between the United States and Taiwan,” Liu told reporters.

    This would be a huge subsidy for a plant which would be in large part automated, and thus create only a very limited number of jobs.

    TSMC first announced its plans last month.

    TSMC announced in a press release that it intends to build a chip factory in the United States, specifically in Arizona.

    Construction is expected to begin in 2021 and the first chips from the fab could be manufactured in 2024. TSMC is the exclusive manufacturer of the A-series chips Apple uses in its iOS devices […]

    It is widely expected that Apple’s chip orders will eventually be fulfilled — at least partly — from the Arizona plant.

    TSMC says the total spending on this project between 2021 and 2029 will be about $12 billion.

    The White House touted this as a successful step toward Apple products being manufactured in the US.

    However, questions were quickly raised by three senators about financial incentives, and whether these would give TSMC an unfair advantage over US chipmakers like Micron, GlobalFoundries, and Cree.

    We ask that you cease any such negotiations or discussions until you have briefed the relevant authorization and appropriations committees with your plans, including any commitments you have made to funding, tax breaks, licensures, or other incentives.

    Claims that the plant would create 1,600 US jobs have also been questioned.

    The unfolding story of the TSMC Arizona plant is looking increasingly like a replay of the saga of the Foxconn plant in Wisconsin, which promised 13,000 jobs in return for $4B in subsidies, and has so far delivered only empty offices and just a handful of jobs. (from Mac 9to5)

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