U.S. Secures $6.6 Billion Deal with TSMC for Arizona Chip Facilities
Agreement to boost American semiconductor production with three new plants.
The United States government has finalized an agreement to grant Taiwanese semiconductor manufacturer TSMC up to $6.6 billion in funding to construct advanced chip production facilities in Arizona.
This deal, announced by President Joe Biden, is expected to stimulate $65 billion in private investment, resulting in the construction of three state-of-the-art plants.
The development is aimed at bolstering U.S. semiconductor capabilities which currently do not include onshore production of leading-edge chips.
Commerce Secretary Gina Raimondo emphasized the national security significance of manufacturing these critical components domestically, given their applications in AI, quantum computing, military technology, and high-performance electronics.
The first plant is slated to be operational by early 2025, with the three facilities collectively producing multiple millions of advanced logic chips for use in cutting-edge technology such as 5G and AI.
The initiative is anticipated to create approximately 6,000 jobs.
While the U.S. has also pledged up to $5 billion in loans to TSMC, it is part of a broader effort under the CHIPS Act aiming to restore the country's stature in global semiconductor production, as it used to produce almost 40% of the world's chips but now only accounts for about 10%.
The announcement comes just before President-elect Donald Trump assumes office, amidst his criticism of the CHIPS Act's effectiveness.
TSMC shares saw a minor decline of 0.6% in New York trading following the news.
This deal, announced by President Joe Biden, is expected to stimulate $65 billion in private investment, resulting in the construction of three state-of-the-art plants.
The development is aimed at bolstering U.S. semiconductor capabilities which currently do not include onshore production of leading-edge chips.
Commerce Secretary Gina Raimondo emphasized the national security significance of manufacturing these critical components domestically, given their applications in AI, quantum computing, military technology, and high-performance electronics.
The first plant is slated to be operational by early 2025, with the three facilities collectively producing multiple millions of advanced logic chips for use in cutting-edge technology such as 5G and AI.
The initiative is anticipated to create approximately 6,000 jobs.
While the U.S. has also pledged up to $5 billion in loans to TSMC, it is part of a broader effort under the CHIPS Act aiming to restore the country's stature in global semiconductor production, as it used to produce almost 40% of the world's chips but now only accounts for about 10%.
The announcement comes just before President-elect Donald Trump assumes office, amidst his criticism of the CHIPS Act's effectiveness.
TSMC shares saw a minor decline of 0.6% in New York trading following the news.
