TSMC Announces $100 Billion US Expansion, Including Five New Chip Factories

Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, has announced a $100 billion investment in the United States, involving the construction of five new chip facilities over the next few years. This announcement, made by TSMC CEO C.C. Wei during a White House meeting with President Donald Trump, comes as the US seeks to reduce its reliance on Asian-made semiconductors.

"We must be able to build the chips and semiconductors that we need right here," Trump stated. "It's a matter of national security for us."

The expansion includes plans for three new chip fabrication plants, two advanced packaging facilities, and a major research and development center. This significant investment follows a previous announcement last April that TSMC would increase its US investment from $25 billion to $65 billion, adding a third Arizona factory by 2030.

TSMC has not yet provided a timeframe for this new round of investments, but it expects to create 40,000 construction jobs over the next four years. The company's first Arizona plant experienced construction delays, and chip production began in 2024 at a higher cost than its facilities in Taiwan.

"Higher costs are definitely a concern for TSMC," noted Andrew Tsai, chairman of Taiwan consulting firm Capital Investment Management Corp., to Reuters.

TSMC's investment is crucial for the US chip industry, as it supplies major US hardware manufacturers such as Nvidia, Qualcomm, and Advanced Micro Devices (AMD). Bringing more production to the US would mitigate supply chain risks for these firms.

TSMC could also play a significant role in supporting Intel, a major US semiconductor manufacturer. Sources familiar with the matter revealed that Trump administration officials met with Wei in New York earlier this year to discuss a potential majority stake in a joint venture with Intel's factory unit. This is part of a broader deal involving several chip companies taking a stake in the venture.

Intel has not yet commented on these meetings.

For Trump, the announcement showcases his commitment to bolstering domestic industries and creating jobs, a key campaign promise. This investment follows similar announcements from companies like Apple, which pledged a $500 billion investment in the US over the next four years, and Emirati billionaire Hussain Sajwani and SoftBank, who have also promised multi-billion dollar investments in the US.

TSMC stated that it "looks forward to discussing our shared vision for innovation and growth in the semiconductor industry, as well as exploring ways to bolster the technology sector along with our customers."

Taiwan's cabinet will review the investment, a requirement for large overseas investments by Taiwanese companies, but views such investments that enhance Taiwan's competitiveness positively. The presidential office will also consider the interests of investors and Taiwan in its review.

"This ensures that while TSMC expands its investment in the U.S., the most advanced processes will remain in Taiwan," said Karen Kuo, a spokesperson for the Presidential Office.

TSMC has not yet disclosed the technology it will use in these new facilities. Last year, the company agreed to produce the world's most advanced 2-nanometer technology at its second Arizona factory, with production expected to begin in 2028. TSMC also agreed to use its most advanced chip-making technology, "A16," in Arizona.

The first Trump administration brought TSMC to Arizona in 2019 and introduced legislation that eventually became the CHIPS and Science Act, passed in 2022 under President Joe Biden. This act provides $52.7 billion in subsidies for American semiconductor production and research.

Last year, the US Commerce Department finalized a $6.6 billion government subsidy for TSMC to produce semiconductors in Phoenix, Arizona. The $100 billion investment announced by TSMC on Monday would be eligible for a 25% manufacturing investment tax credit under the 2022 law.

Under Biden's leadership, the Commerce Department has successfully persuaded five leading global semiconductor firms to establish factories in the US, addressing national security concerns stemming from reliance on imported chips.

China claims sovereignty over Taiwan, but Taiwan's democratically elected government rejects Beijing's claims. On Monday, Commerce Secretary Howard Lutnick suggested that TSMC and other companies were investing in the US to avoid potential tariffs imposed by the Trump administration.

Lutnick told lawmakers in January that the Biden-era program was "an excellent down payment" to rebuild the sector, but has declined to commit to grants approved under Biden, stating a need to "read them and analyze them and understand them."

Last month, a TSMC spokesperson revealed that the company had received $1.5 billion in CHIPS Act funds before the new administration took office, according to the terms of its agreement.