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TSMC Arizona broke ground on its third factory in Arizona on Tuesday while getting a visit from a top Trump administration official

Daniel Nenni

Daniel Nenni

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Published: Apr. 29, 2025 at 4:03 PM PDT

PHOENIX (AZFamily) — The Taiwan Semiconductor Manufacturing Company (TSMC) took another major step in expanding its north Phoenix campus on Tuesday. The company broke ground on its third semiconductor manufacturing fab, or factory, near 43rd Avenue and Dove Valley Road.
TSMC said the third facility will create roughly 6,000 jobs and will manufacture chips using 2 nanometer or even more advanced process technology, with production starting by the end of the decade.

The milestone coincided with a visit from the U.S. Secretary of Commerce Howard Lutnick, who praised the groundbreaking and expansion of TSMC’s facilities. He said it was part of the Trump administration’s renewed commitment to strengthening the “golden age of American manufacturing.” “We are at TSMC Arizona to celebrate the return of American manufacturing. President Trump’s bold leadership and clear direction are driving companies and jobs back to this country at a record pace,” Lutnick said.

TSMC is the world’s biggest semiconductor manufacturer and produces chips for companies including Apple, Intel and Nvidia. “AI is revolutionizing every aspect of the technology stack, and Nvidia AI supercomputers are at the foundation. We’re proud to produce our technology in Arizona, bringing AI infrastructure manufacturing back to America. The administration’s support for U.S. manufacturing makes this possible—and vital—for the next industrial revolution,” said Jensen Huang, founder and CEO of Nvidia.

The visit comes nearly two months after TSMC announced it planned to invest an additional $100 billion in the United States, including new and existing Valley sites. That was on top of the more than $65 billion investment in the U.S., which included three plants in Arizona after the Biden administration offered billions in subsidies.

TSMC said the investment is expected to create 40,000 construction jobs over the next four years, tens of thousands of high-paying, high-tech jobs, and drive over $200 billion in different areas across Arizona during the next 10 years.

TSMC Arizona first announced plans to invest in a massive Phoenix campus for making semiconductors in May 2020. About 1,130 acres of land were acquired seven months later, and construction on the first fab began in April 2021.
Then-President Joe Biden visited the campus in December 2022 when TSMC celebrated the semiconductor manufacturing equipment arriving in Arizona. The company also announced its commitment to a second advanced fab in Arizona. The announcement of its third fab came in April 2024.

TSMC Arizona was awarded up to $6.6 billion from the CHIPS Act in December.

www.azfamily.com

TSMC breaks ground on third facility in north Phoenix

TSMC Arizona broke ground on its third factory in Arizona on Tuesday while getting a visit from a top Trump administration official.
www.azfamily.com www.azfamily.com
 
Another N-1 or N-2 (in 2030) factory. It’s all very good for US semi industry. I just wonder if the folks in charge understand that TW is not going to give US a truly leading edge factory. Maybe ever.

We need competition.
 
sonchoy said:
The sad part is that China prioritizes SMIC, Taiwan prioritizes TSMC, Korea prioritizes Samsung, while the US does not seem to have a national priority in the semiconductor arena.

As Churchill said "US will always do the right thing, after it has tried out everything else."
Click to expand...
US is not even trying if you ask me. 🤣
 
sonchoy said:
The sad part is that China prioritizes SMIC, Taiwan prioritizes TSMC, Korea prioritizes Samsung, while the US does not seem to have a national priority in the semiconductor arena.

As Churchill said "US will always do the right thing, after it has tried out everything else."
Click to expand...

The United States has TSMC. It has been two presidents and the U.S. strategy is crystal clear
 
It wasn't always obvious that building advanced fabs (7nm and below, EUV fabs) would work in the USA. Morris Chang himself was a skeptic.

Semiwiki contributor Scotten Jones wrote this in 2021:

semiwiki.com

TSMC Arizona Fab Cost Revisited - Semiwiki

Back in May of 2020 I published some comparisons of the cost to run a TSMC fab in Arizona versus their fabs in Taiwan. I found the fab operating cost based on the country-to-country difference to only be 3.4% higher in the US and then I found an additional 3.8% because of the smaller fab…
semiwiki.com semiwiki.com

Looks like Scotten was right.

"The bottom line to all this is the cost for TSMC to make wafers in the US is only 7% higher than Taiwan if they built the same size fab complex in the US as what they have in Taiwan. Because they are building a smaller Fab complex the cost will be 17% higher but that is due to TSMC’s decision to build a smaller fab, at least initially."

Now that fab construction is underway, it is cheaper to continue building the next phase (7% cost delta). The economics of reindustrializing in the USA is sustainable. It just needs to overcome "activation energy" startup costs.
 
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