The Biden administration on Monday pledged up to $6.6 billion to allow the Taiwanese semiconductor giant to expand facilities it’s already building in Arizona and better ensure that state-of-the-art microchips are produced domestically for the first time.
U.S. Commerce Secretary Gina Raimondo said TSMC’s financing means the company can expand its existing plans to build two factories in Phoenix and add a newly announced third production center.
“These are the chips that underpin all artificial intelligence, and they are a necessary part of the technology we need to support our economy,” Raimondo said in a phone interview with reporters. He added that they are crucial to the “21st century.” Military and national security agencies. ”
The funding is tied to a sweeping 2022 law celebrated by President Joe Biden to revive U.S. semiconductor manufacturing. The $280 billion package, known as the CHIP and Science Act, is designed to bolster U.S. advantages in military technology and manufacturing while minimizing supply disruptions that would occur after the coronavirus pandemic began in 2021. The chip shortage came to a standstill at the time. Factory assembly lines fueled inflation.
The Biden administration has pledged tens of billions of dollars to support the construction of U.S. chip foundries and reduce reliance on Asian suppliers, which Washington considers a security vulnerability.
“Semiconductors — those tiny chips smaller than a fingertip — power everything from smartphones to cars to satellites and weapons systems,” Biden said in a statement. “TSMC’s new commitment to the United States and Investments in Arizona represent the broader story of American-made semiconductor manufacturing, with strong support from America’s leading technology companies to manufacture the products we rely on every day.”
TSMC makes nearly all of the world’s cutting-edge microchips and plans to eventually do so in the U.S.
The company began construction of its first plant in Phoenix in 2021 and a second hub last year, increasing its total investment in the two projects to $40 billion. Raimondo said a third factory will begin producing microchips by the end of the decade, raising the company’s total commitment to $65 billion.
The investments will put the U.S. on track to produce about 20% of the world’s cutting-edge chips by 2030, and Raimondo said they will help create 6,000 manufacturing jobs and 20,000 construction jobs, as well as thousands of new jobs related to technology. New positions indirectly related to various industries. Suppliers to chip-related industries associated with the Arizona project.
Potential incentives announced Monday include $50 million to help train Arizona’s workforce to better work in the new facilities. In addition, approximately $5 billion in proposed loans will be made available through the CHIPS and Science Act.
“TSMC’s commitment to manufacturing cutting-edge chips in Arizona marks a new chapter for the U.S. semiconductor industry,” White House National Economic Council Director Lael Brainard told reporters.
The news comes as U.S. Treasury Secretary Janet Yellen is visiting China. Senior administration officials were asked on a conference call with reporters whether the Biden administration had warned China about the upcoming investment, given the delicate geopolitics surrounding Taiwan. Officials said only that the focus of their Monday announcement was simply to boost U.S. manufacturing.
“We are excited about the progress of the Arizona fab to date and are committed to its long-term success,” TSMC CEO CC Wei said in a statement.
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