TSMC, the world's largest semiconductor foundry, is set to begin mass production at its new advanced chip-manufacturing facility in Phoenix, Arizona in 2025. This marks a historic moment for U.S. semiconductor manufacturing capabilities.
The Arizona plant will produce cutting-edge 4-nanometer chips, the same technology used in Nvidia's most advanced GPUs. Early performance indicators are promising, with yields reportedly 4% higher than TSMC's Taiwan facilities.
The U.S. government is supporting this initiative with $6.6 billion in CHIPS Act funding. However, the move was primarily driven by major tech companies like Apple, Nvidia, Google, Amazon, and Qualcomm seeking to diversify their supply chains beyond Taiwan.
The facility's establishment comes amid growing concerns about semiconductor supply chain stability, highlighted by recent chip shortages and geopolitical tensions. TSMC currently manufactures 90% of the world's advanced chips, making the industry heavily dependent on Taiwan-based production.
A second fab is planned for 2028, capable of producing even more advanced 2- or 3-nanometer chips. TSMC also intends to construct a third U.S. facility with next-generation technology.
The project has faced some challenges, particularly around workforce development. Cultural differences between American and Taiwanese work approaches have required adjustment, though recent reports suggest these issues are being addressed.
Other major players are also expanding U.S. operations. Samsung plans to open a facility in Texas, while Intel is developing new sites in Arizona and Ohio with CHIPS Act support. These developments represent a major shift in global semiconductor manufacturing, potentially reshaping the industry's geographic distribution.
The success of TSMC's Arizona facility will serve as a key indicator of both the CHIPS Act's effectiveness and the viability of advanced semiconductor manufacturing in the United States.