President Trump announced on Monday that Taiwan Semiconductor Manufacturing Company (TSMC), the largest chip manufacturer globally, will invest $100 billion in the United States over the next four years. This investment aims to expand TSMC's production capacity and introduce its most advanced semiconductor processes at its facilities in Arizona.
The new funding will enable TSMC to produce artificial intelligence and smartphone chips in Arizona. With this commitment, TSMC's total planned expenditure in the United States will reach $165 billion, expanding its operations in Arizona from three to six manufacturing plants, creating 25,000 jobs, and establishing a research and development center focused on future production processes.
This expansion follows years of efforts to bolster domestic semiconductor manufacturing. Concerns regarding TSMC's dominance in the chip industry have raised national security issues, with apprehensions that the U.S. could lose access to advanced chips produced in Taiwan amid geopolitical tensions involving Beijing's claims over the island.
The previous administration initiated efforts to persuade TSMC to establish plants in the U.S., which were furthered by the current administration's enactment of the CHIPS Act. This bipartisan legislation allocated $39 billion in federal funding to support the construction of new and expanded semiconductor manufacturing facilities.
During a White House event, Trump emphasized that TSMC's investment would mitigate national security risks and inspire other companies to manufacture more domestically. He stated, “Semiconductors are the backbone of the 21st century economy, and really without the semiconductors, there is no economy.” He stressed the need for the U.S. to produce its chips with local labor and skills.
TSMC's CEO, C.C. Wei, confirmed that the company would start producing A.I. and smartphone chips in the U.S., with the expansion supported by American customers such as Apple, Nvidia, AMD, Qualcomm, and Broadcom.
Trump noted that the investment would help TSMC avoid tariffs exceeding 25 percent on chips made in Taiwan. Since taking office, he has threatened to impose tariffs of up to 100 percent on Taiwanese chips and criticized the CHIPS Act for not prompting more domestic chip production.
In response to tariff threats, TSMC and Taiwanese officials have been actively exploring investment opportunities in the U.S. In January, Wei met with the commerce secretary to discuss potential investments, including a possible acquisition of Intel's manufacturing operations.
The recent investment more than doubles TSMC's previous commitment to the U.S. Under the CHIPS Act, the company had pledged $65 billion to build three factories in Arizona, initially focused on legacy technologies producing less advanced chips compared to those manufactured in Taiwan.
TSMC's announcement marks its position alongside other companies that have recently made significant investment commitments at the White House. In January, companies like OpenAI, Oracle, and SoftBank pledged $500 billion for data centers over four years. Last month, Apple CEO Tim Cook also made a commitment to invest $500 billion, including funding for a new factory in Houston dedicated to A.I. server production.
Commerce Secretary Lutnick remarked that companies are eager to invest in the U.S. to access its vast market and avoid tariffs, highlighting the urgency of their commitment to domestic manufacturing.