Chipmaker TSMC to build 'up to five' more factories in Arizona

Copper State turns silicon?

TSMC is said to be considering building up to five additional chip plants in Arizona as well as the one it announced last year.

Under the previous president, the US government wooed the Taiwanese chipmaker into opening another semiconductor fabrication plant on US soil – the biz has a subsidiary in Washington state turning out 350 to 160nm parts. In May 2020, TSMC said it would construct a factory in Phoenix, Arizona, by 2024 capable of producing 20,000 5nm chip wafers every month.

Now the manufacturing giant is planning to open up to five more in Arizona, according to Reuters, which heard from unnamed sources. CEO C.C. Wei hinted his corporation was increasing its collection of production plants to boost chip output during an earnings call in mid-April.

“We have acquired land and started the construction of new facilities," he said [PDF]. "TSMC expects to invest about $100bn through the next three years to increase capacity to support the manufacturing and R&D of leading edge and specialty technologies."

The biz also hopes to begin risk production of 4nm and 3nm chips this year, and achieve volume output in the second half of next year. The Register has asked TSMC for comment on today's report.

This zeal to build facilities in the Grand Canyon State comes amid major global component shortages after supply chains buckled during the COVID-19 pandemic and amid rising geopolitical tensions with China.

The chip drought is a result of a perfect storm: a surge in demand for PCs, graphics cards, games consoles, phones, and servers as people stayed or worked at home and needed remote services, home entertainment, and better kit; manufacturers in the automotive world and other industries reducing orders in anticipation of an economic slowdown and then having no supplies as things pick up again; vendors hoarding parts amid Trump's supply crackdowns on China; COVID-19 outbreaks and the Texas super-freeze temporarily halting fabrication lines, and so on. In short, factory capacity can't keep up with global demand for a good number of reasons.

President Biden just signed an executive order to identify and resolve choke points in supply chains, and has backed a bill to spend $50bn in chip R&D and manufacturing in America.

US chipmakers have also asked for tax subsidies and increased financial support to expand on their home turf to remain competitive with countries developing chips for AI and 5G technologies.

Intel’s CEO Pat Gelsinger also announced this week his mega-corp is investing $3.5bn to build a 3D packaging semiconductor lab in New Mexico. “Intel’s $3.5 billion investment in New Mexico will create 700 new jobs in the next three years and establish the Rio Rancho campus as the company's domestic hub for advanced semiconductor manufacturing,” New Mexico’s Governor Michelle Lujan Grisham said in a canned statement. ®