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Apple pushes TSMC to make more advanced chips in US by 2024

Biden to join Tim Cook as well as AMD and Nvidia chiefs for an announcement from the semiconductor giant next week

TSMC reportedly plans to make 4nm chips at its Arizona manufacturing plant when it goes online in 2024, a significant upgrade from the Asian foundry giant's previous commitment to focus on less advanced 5nm silicon at its first leading-edge US fab.

The Taiwanese chipmaker has updated plans for its Phoenix fab at the behest of its customers including Apple, Nvidia, and AMD, Bloomberg reported Thursday.

President Joe Biden is expected to join Apple CEO Tim Cook, Nvidia CEO Jensen Huang, and AMD CEO Lisa Su at a ceremony in Arizona next Tuesday where TSMC will make the announcement, the report said.

TSMC is also anticipated to confirm at the event that it will construct a second fab at the Phoenix site to make 3nm chips, its most state-of-the-art silicon in production, according to the newsw wire. The company's founder, Morris Chang, said last week that TSMC was weighing the possibility.

The developments mean the United States will have more advanced chipmaking capabilities sooner than anticipated. Intel is building out new fabs for advanced chips in Arizona and Ohio that are expected to go online in 2024 and 2025 respectively. Meanwhile, Samsung is constructing a leading-edge plant in Texas set for 2024 operation, and there's possibility of a massive expansion.

Increased chipmaking capabilities and capacity have been top priorities of the US government, which seeks to rebalance the world's silicon supply chain and move reliance away from Asian manufacturing hubs by using $52 billion in subsidies approved this year to aid with new fab construction.

There has been a sense of urgency to move more chip production to the West, in part due to concerns that China could invade Taiwan and disrupt the island nation's chip manufacturers, which make up most of the world's advanced chipmaking capacity. The tech world has also been keen to diversify the global silicon supply chain due to disruptions caused by the COVID-19 pandemic.

When Cook said earlier this month Apple plans to source chips from an Arizona fab in 2024, he said the goal was to reduce the iPhone maker's reliance on Taiwan fabs, according to an earlier report.

The accelerated ramp-up of TSMC's capabilities in the US is likely to create more pressure for Intel, which plans to compete with the Taiwanese company and other contract chip manufacturers like Samsung through its revitalized foundry business. Last week, we reported that Intel Foundry Services had a major leadership shakeup.

Intel is racing to catch up with TSMC and Samsung in making more advanced chips after several years of manufacturing missteps. The company recently said it's on track to surpass its Asian rivals in process performance by 2025. But it may be a challenge for Intel to convince chip design rivals to use the company's manufacturing services. ®

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