The administration of US President Joe Biden finalized its CHIPS Act incentive awards for Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), marking a major milestone for a program meant to bring semiconductor production back to US soil.
TSMC would get US$6.6 billion in grants as part of the contract, the US Department of Commerce said in a statement yesterday. Though the amount was disclosed earlier this year as part of a preliminary agreement, the deal is now legally binding — making it the first major CHIPS Act award to reach this stage.
The chipmaker, which is also taking up to US$5 billion in loans, would get at least US$1 billion of the total this year, because it has already achieved some of the benchmarks required, officials said.
Photo: Caitlin O’Haram, Bloomberg
Finalizing the agreement with TSMC guarantees that cutting-edge semiconductor manufacturing would return to the US, bringing essential capabilities onshore, US Secretary of Commerce Gina Raimondo said in a briefing.
“This is some of the most sought-after technology on the planet,” she said. “It’s impossible to overestimate how significant this is for America’s national and economic security.”
More deals would be completed in the coming weeks, solidifying one of the country’s biggest pieces of industrial policy in decades and a signature piece of legislation for the outgoing Biden administration.
The CHIPS and Science Act set aside US$39 billion in grants, US$75 billion in loans and loan guarantees, and 25 percent tax credits — all to lure semiconductor manufacturing to the US after decades of production shifting to Asia. The vast majority of the funds have been allocated, but only a portion of those awards are set in stone, including one small grant announced in September.
In TSMC’s case, the money would help underwrite more than US$65 billion of spending to build a three-factory complex north of Phoenix, Arizona. More funds would be released when the company hits additional targets. The project is the largest-ever foreign direct investment by a company in a new site, the Commerce Department said.
Officials are under increasing pressure to wrap up talks and get money out the door. Business groups in four states with projects in line for CHIPS Act funding — Ohio, New Mexico, Oregon and New York — pushed for the immediate release of that money in a recent letter to Biden, the Columbus Dispatch reported.
Three of those states have projects by Intel Corp, and that company’s chief executive officer has expressed his frustration with the process. Intel is facing serious business challenges that have complicated its CHIPS Act negotiations. The chipmaker is still working through substantive terms of its contract, including what happens if the company spins off its manufacturing business or is acquired in part or in whole.
US president-elect Donald Trump’s return to the White House in January has added urgency to the effort.
There is little fear among companies that the CHIPS Act would go away, but firms like Intel, Samsung Electronics Co and Micron Technology Inc are eager to avoid the possibility of having to renegotiate terms with a new administration.
KEEPING UP: The acquisition of a cleanroom in Taiwan would enable Micron to increase production in a market where demand continues to outpace supply, a Micron official said Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips. Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday. The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said. Micron expects the transaction to
Nvidia Corp’s GB300 platform is expected to account for 70 to 80 percent of global artificial intelligence (AI) server rack shipments this year, while adoption of its next-generation Vera Rubin 200 platform is to gradually gain momentum after the third quarter of the year, TrendForce Corp (集邦科技) said. Servers based on Nvidia’s GB300 chips entered mass production last quarter and they are expected to become the mainstay models for Taiwanese server manufacturers this year, Trendforce analyst Frank Kung (龔明德) said in an interview. This year is expected to be a breakout year for AI servers based on a variety of chips, as
Global semiconductor stocks advanced yesterday, as comments by Nvidia Corp chief executive officer Jensen Huang (黃仁勳) at Davos, Switzerland, helped reinforce investor enthusiasm for artificial intelligence (AI). Samsung Electronics Co gained as much as 5 percent to an all-time high, helping drive South Korea’s benchmark KOSPI above 5,000 for the first time. That came after the Philadelphia Semiconductor Index rose more than 3 percent to a fresh record on Wednesday, with a boost from Nvidia. The gains came amid broad risk-on trade after US President Donald Trump withdrew his threat of tariffs on some European nations over backing for Greenland. Huang further
HSBC Bank Taiwan Ltd (匯豐台灣商銀) and the Taiwan High Prosecutors Office recently signed a memorandum of understanding (MOU) to enhance cooperation on the suspicious transaction analysis mechanism. This landmark agreement makes HSBC the first foreign bank in Taiwan to establish such a partnership with the High Prosecutors Office, underscoring its commitment to active anti-fraud initiatives, financial inclusion, and the “Treating Customers Fairly” principle. Through this deep public-private collaboration, both parties aim to co-create a secure financial ecosystem via early warning detection and precise fraud prevention technologies. At the signing ceremony, HSBC Taiwan CEO and head of banking Adam Chen (陳志堅)
RSS