Taiwan Semiconductor Manufacturing Company plans to bring its most advanced technology to Arizona, the founder of the chip giant said Monday.
TSMC’s plans come as tensions between Washington and Beijing are rising over chips, with President Joe Biden imposing a sweeping set of controls on the sale of advanced chips and chip-making equipment to Chinese firms.
Taiwan, a self-governing democracy that the Chinese Communist Party claims as its own territory despite having never controlled it, has also faced growing military aggression from Beijing in recent months – throwing a spotlight on the critical role the island plays in the global chipmaking industry.
TSMC accounts for an estimated 90% of the world’s super-advanced computer chips, supplying tech giants including Apple and Qualcomm.
“Chips are very important products,” TSMC’s founder Morris Chang said Monday at a press briefing in Taipei. “It seems that people are only starting to realize this recently, and as a result, lots of people out there are envious of Taiwan’s chip manufacturing.”
Chang has retired but remains an influential force within the industry. He was briefing reporters after returning to Taipei from Bangkok, where he was representing Taiwan at the meeting of the Asia-Pacific Economic Cooperation (APEC) leaders.
At APEC, Chang discussed the semiconductor industry with Vice President Kamala Harris and also met with Chinese President Xi Jinping. Harris welcomed TSMC’s investment in Arizona, he said.
Super-advanced semiconductor chips — like the ones produced by TSMC — are an indispensable part of everything from smartphones to washing machines. They are also difficult to make because of the high cost of development and the level of knowledge required, meaning much of the production is concentrated in just a handful of suppliers.
Advances in chip manufacturing require etching ever-smaller transistors on to silicon wafers. Chang said its plant in Arizona will produce 3-nanometer chips, TSMC’s most advanced technology.
In 2020, the company had already committed at least $12 billion to build its first facility in Arizona. At the time, the tech giant had said that the facility will “utilize TSMC’s 5-nanometer technology for semiconductor wafer fabrication” and “create over 1,600 high-tech professional jobs directly.” Production is expected to begin in 2024.
“I not only believe, but know for a fact that the cost of manufacturing chips in the US will be at least 55% higher than in Taiwan,” Chang had said at a press meeting on Saturday on the sidelines of APEC.
“But that does not mitigate against moving some capacity to the US. The chip manufacturing process we moved over is the most advanced of any company in the US, and that is very important to the US.”
Chang’s comments come only days after Warren Buffett’s Berkshire Hathaway disclosed that it had purchased a $4.1 billion stake in TSMC.
The increase in TSMC’s presence in the US comes at a time when tensions between China and Taiwan are escalating.
The fate of the island’s chip industry has become a global concern. Experts have warned that any disruption to Taiwan’s chip supply could paralyze production of key equipment, impacting almost everyone in the world.