TSMC to Build Up to Five Additional Fabrication Plants in Arizona [Report]

TSMC to Build Up to Five Additional Fabrication Plants in Arizona [Report]

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In May 2020, TSMC announced that it would build a $12 billion fabrication plant in Phoenix, Arizona with support from the Trump Administration. Three sources now tell Reuters that is just the beginning and the company is planning up to five additional fabs at the same location.

One source said the expansion comes at the request of the U.S. government. Another source said TSMC made sure there was enough room for expansion when they obtained the land. The third person, from a TSMC supplier, said they were told the plan was to build six fabs over three years.

The initial 12-inch wafer fabrication plant is expected to start production in 2024. It has a planned output of 20,000 wafers every month using the company's 5nm process.

On an earnings call last month, CEO C.C. Wei hinted at the possibility of expansion.

“But in fact, we have acquired a large piece of land in Arizona to provide flexibility. So further expansion is possible, but we will ramp up to Phase 1 first, then based on the operation efficiency and cost economics and also the customers’ demand, to decide what the next steps we are going to do.”Asked whether the planned expansion was because of a request from the United States, TSMC said it was “not sure” what was meant by “requests” coming from the U.S. side and that it will decide next steps based on operational efficiency, cost economics and customer demand.

A worldwide chip shortage has affected multiple industries this year and it's no surprise that both the Trump Administration and Biden Administration have pushed for production capacity to be added in the United States. TSMC recently announced it will spend $100 billion over the next three years to expand its capacity; however, it's unclear how much of that investment will be in Arizona.

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TSMC to Build Up to Five Additional Fabrication Plants in Arizona [Report]

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