TSMC and Foxconn expand overseas operations as AI server demand surges
TAIPEI (Taiwan News) — Taiwanese tech companies are investing billions in US facilities to meet soaring AI demand, Nikkei Asia reported Wednesday.
Nvidia CEO Jensen Huang (黃仁勳) praised Taiwan’s supply chain during a meeting in Taipei, attended by more than 40 chairpeople and CEOs from 25 major suppliers, per Reuters. Huang called the year “very challenging” but said the rollout of Nvidia’s next-generation AI chips has been smooth thanks to Taiwan’s partners.
The gathering included TSMC, MediaTek, Delta Electronics, Foxconn and several others. “Without Taiwan, there will be no Nvidia today,” Huang said.
Despite his praise, more than a third of the companies at the dinner are investing in US expansions, sparking concerns over Taiwan’s long-term tech dominance. Historically, tech manufacturing was concentrated in Asia, particularly China, but AI is shifting the balance.
Quanta Computer announced NT$28.39 billion (US$904 million) to expand server production in California and Tennessee for 2025 and beyond. Its previous record investment in Taiwan was NT$1.57 billion in 2018, during early US-China trade tensions.
Foxconn and Wistron are planning more than NT$31.79 billion each to expand US production and labs, mainly in Texas. Inventec, Pegatron, and Compal are also building new Texas factories to meet growing AI server demand.
Foxconn Chair Young Liu (劉揚偉) told Nikkei Asia that US expansion for this year and next will exceed last year's investments. TSMC is also ramping up, allocating a large share of its record NT$1.75 trillion capex for Arizona plants to meet AI demand.
Huang said the AI era requires three types of factories: for chips, computers, and AI itself. He called current investments “the largest infrastructure build-out in history,” noting AI data centers are a key part of the expansion.
The US-Taiwan trade deal, finalized after months of negotiation, lowered threatened tariffs from 20% to 15% in exchange for NT$7.86 trillion in Taiwanese investment. It also strengthens AI and chip cooperation under the Pax Silica initiative.
President Lai Ching-te (賴清德) highlighted the need for a “non-red supply chain,” reducing reliance on China amid geopolitical uncertainty. “Taiwan and the US are the most suitable strategic partners,” he said, per Nikkei Asia.
Industry executives said market demand, not government support, drives most US investments. PwC Taiwan reported 40% of Taiwanese companies see the US as their top investment destination in 2025, up 12 points from 2024.
GlobalWafers has expanded its US plants and is preparing a second phase to meet customer demand. Wistron Chair Lin Hsien-ming (林憲銘) cited reliable power and proximity to US AI clients as key factors for Texas expansions.
Despite US growth, Lin emphasized that Taiwan remains central, with heavy domestic research and capacity investment. “We remain rooted in Taiwan while extending our influence globally,” he said.
Taiwan’s economy has benefited from AI-related orders, with GDP growing 8.63% last year, the fastest in 15 years, according to the National Development Council.
Counterpoint Research analyst Brady Wang noted AI servers differ from traditional ones, requiring advanced cooling and logistics. He said building assembly capacity in the US reduces risks and keeps these strategic assets closer to key markets.
TAIPEI (Taiwan News) — Taiwanese tech companies are investing billions in US facilities to meet soaring AI demand, Nikkei Asia reported Wednesday.
Nvidia CEO Jensen Huang (黃仁勳) praised Taiwan’s supply chain during a meeting in Taipei, attended by more than 40 chairpeople and CEOs from 25 major suppliers, per Reuters. Huang called the year “very challenging” but said the rollout of Nvidia’s next-generation AI chips has been smooth thanks to Taiwan’s partners.
The gathering included TSMC, MediaTek, Delta Electronics, Foxconn and several others. “Without Taiwan, there will be no Nvidia today,” Huang said.
Despite his praise, more than a third of the companies at the dinner are investing in US expansions, sparking concerns over Taiwan’s long-term tech dominance. Historically, tech manufacturing was concentrated in Asia, particularly China, but AI is shifting the balance.
Quanta Computer announced NT$28.39 billion (US$904 million) to expand server production in California and Tennessee for 2025 and beyond. Its previous record investment in Taiwan was NT$1.57 billion in 2018, during early US-China trade tensions.
Foxconn and Wistron are planning more than NT$31.79 billion each to expand US production and labs, mainly in Texas. Inventec, Pegatron, and Compal are also building new Texas factories to meet growing AI server demand.
Foxconn Chair Young Liu (劉揚偉) told Nikkei Asia that US expansion for this year and next will exceed last year's investments. TSMC is also ramping up, allocating a large share of its record NT$1.75 trillion capex for Arizona plants to meet AI demand.
Huang said the AI era requires three types of factories: for chips, computers, and AI itself. He called current investments “the largest infrastructure build-out in history,” noting AI data centers are a key part of the expansion.
The US-Taiwan trade deal, finalized after months of negotiation, lowered threatened tariffs from 20% to 15% in exchange for NT$7.86 trillion in Taiwanese investment. It also strengthens AI and chip cooperation under the Pax Silica initiative.
President Lai Ching-te (賴清德) highlighted the need for a “non-red supply chain,” reducing reliance on China amid geopolitical uncertainty. “Taiwan and the US are the most suitable strategic partners,” he said, per Nikkei Asia.
Industry executives said market demand, not government support, drives most US investments. PwC Taiwan reported 40% of Taiwanese companies see the US as their top investment destination in 2025, up 12 points from 2024.
GlobalWafers has expanded its US plants and is preparing a second phase to meet customer demand. Wistron Chair Lin Hsien-ming (林憲銘) cited reliable power and proximity to US AI clients as key factors for Texas expansions.
Despite US growth, Lin emphasized that Taiwan remains central, with heavy domestic research and capacity investment. “We remain rooted in Taiwan while extending our influence globally,” he said.
Taiwan’s economy has benefited from AI-related orders, with GDP growing 8.63% last year, the fastest in 15 years, according to the National Development Council.
Counterpoint Research analyst Brady Wang noted AI servers differ from traditional ones, requiring advanced cooling and logistics. He said building assembly capacity in the US reduces risks and keeps these strategic assets closer to key markets.