TSMC, a multinational manufacturer of computer chips, has announced that it will invest $40 billion (£33 billion) in a massive US facility.
It is one of the largest foreign investments in the history of the United States.
The statement was made as President Joe Biden and the Taiwanese company’s CEO inaugurated the Arizona factory.
The Biden administration is moving forward with efforts to bring the manufacture of essential components used in everything from cell phones to military jets back to the United States.
Apple is a client of TSMC, the world’s leading manufacturer of microchips for other firms.
Its Arizona facilities will build 3-nm and 4-nm processing chips for iPhones. Semiconductors are considered to as the “brains” of electronics such as cellphones, automobile components, and artificial intelligence technologies.
Mark Liu, chairman of TSMC, stated that the company would construct two semiconductor production units, the first of which would be operational by 2024. The total investment will approximate $40 billion. This is the company’s largest investment outside of Taiwan.
The investment provides Mr. Biden with a boost in the wake of supply chain disruptions that have led to chip shortages and amid escalating tensions between the United States and China.
The initial agreement for TSMC to construct a plant in the United States was reached in 2020 when President Donald Trump was in power. The most recent announcement significantly raises the size of the investment.
During a speech on Tuesday in Phoenix, Mr. Biden stated, “Today, we produce only about 10 percent of the world’s chips, despite leading the world in research and design of new chip technologies.
He stated that the United States once produced more than 30 percent of the world’s computer chips before the jobs moved offshore.
“The United States is in a better position than any other nation to lead the global economy in the coming years,” he continued.
Several CEOs of technological businesses that rely on TSMC production, including Nvidia and Advanced Micro Devices, attended the opening ceremony.
Tim Cook, chief executive officer of Apple, described the event as momentous.
“We anticipate increasing this work in the coming years as TSMC establishes new and deeper roots in the United States,” he said.
Analysts view TSMC’s investment as a potential industry-altering development.
According to Wedbush analyst Dan Ives, TSMC’s investment is a key milestone for US chip spending over the next decade. This is a huge strategic move by TSMC that ignites a serious struggle between the United States and China for chip production.
In August, in response to fears that the United States was losing its technical edge to China, President Biden signed a law allocating $280 billion (£232 billion) to high-tech industry and scientific research. The investments include tax advantages for corporations that construct manufacturing facilities for computer chips in the United States.
The move occurred when relations between the two countries deteriorated.
This has been fueled by Beijing’s claims over Taiwan and its growing assertiveness throughout Asia. Beijing views Taiwan as a portion of its territory that must be forcibly merged with the mainland. Taiwan distinguishes itself from the mainland.
In response, the United States has restricted access to modern computer chip technologies.
This has negatively impacted China’s export-driven economy, which employs technology to manufacture and sell everything from mobile phones to electric vehicles.
