TSMC confirms plans to build 5nm chip factory in Arizona

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Report: TSMC ready to start volume production of Apple A13 chip.
Image: TSMC

Last week, The Wall Street Journal reported the Taiwanese Semiconductor Manufacturing Company (TSMC) would establish a new 5nm chip foundry in Arizona. The manufacturer has since confirmed its plans to expand its U.S. production capacity, including listing its expected costs and staffing level.

In addition, the New York Times notes Intel and other large chipmakers may soon follow in TSMC’s footsteps.

Details on TSMC’s Arizona Plant

TSMC intends to establish a 5nm component production facility in Arizona with an eye toward beginning manufacturing operations in 2024. Once up and running, the plant will directly employ 1,600 workers and will fabricate 20,000 semiconductor wafers every month.

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The company plans to spend $12 billion on its new factory and will spread its cost out across 2021 to 2029. The manufacturer noted state and federal agencies would subsidize the project, but it did not offer any specifics.

The New York Times states TSMC’s Arizona facility will be about one-fifth the size of its largest foundries. The publication also notes the corporation will outfit the facility with current generation chip fabrication equipment. The company did not pin down what kind of components the new facility would make. However, the firm currently fabricates Apple’s A-series processors and supplies the Defense Department with fighter jet microelectronics.

A New Trend?

TSMC’s announcement follows reports that the White House requested several leading chipmakers to build new factories in the U.S. The Trump administration wants to avoid supply chain disruption to crucial chips the military utilizes. In recent years, the flow of components in the United States has been adversely affected by the Sino-American trade war and the coronavirus pandemic.

After its launch, TSMC’s Arizona plant will protect the company from those costly and time-consuming problems. Indeed, the corporation said the new American facility would help it “support our customers and partners” and “attract global talent.”

Large semiconductor manufacturers Intel, GlobalFoundries, and Samsung may also seek to expand their U.S. production capacity.

According to the New York Times, Defense Department officials have approached the above-listed chipmakers with concerns about the lack of advanced U.S. based factories. Moreover, Intel sent a letter to the Pentagon last month expressing interest in establishing a new American foundry, one that could fabricate sensitive government microelectronics.

Provided the appropriate subsidies and contracts could be secured, international semiconductor makers could make the U.S. a new manufacturing hub.

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