US government grants Taiwanese chip major TSMC $6.6 billion subsidy for new chip plant

In a groundbreaking move, TSMC secured up to $6.6 billion in subsidies from the US Department of Commerce for its Arizona chip plant under the CHIPS and Science Act. The US government also proposed $5 billion in low-cost loans for TSMC. The Taiwanese company plans to build a third fab at TSMC Arizona to meet customer demand using cutting-edge semiconductor technology in the US.

TSMC Chairman, Dr Mark Liu, expressed his excitement about the opportunity provided by the CHIPS and Science Act, stating that it allows the company to make an unprecedented investment in the US. He also mentioned that TSMC’s US operations will contribute to future advancements in semiconductor technology.

With a total capital expenditure exceeding $65 billion, TSMC’s investment in the Arizona site is the largest foreign direct investment in the state’s history and the largest in a greenfield project in the US. The three fabs at TSMC Arizona are expected to create around 6,000 direct high-tech, high-wage jobs, with additional opportunities for construction, supplier, and consumer jobs.

According to the Greater Phoenix Economic Council, the increased investment in three fabs will result in over 20,000 unique construction jobs and tens of thousands of indirect supplier and consumer jobs. TSMC Arizona’s first fab is set to begin production with 4 nm technology in the first half of 2025, while the second fab will produce the world’s most advanced 2 nm process technology, along with the previously announced 3 nm technology, starting in 2028.