Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s top producer of artificial intelligence (AI) chips, plans to invest an additional US$100 billion in US plants that will boost its chip output on American soil and support US President Donald Trump’s goal of increasing domestic manufacturing.
TSMC chief executive officer C.C. Wei (魏哲家) joined Trump at the White House yesterday to unveil the company’s vision for expanding a US footprint that got its start in 2020 during the president’s first term. Trump said the move means “the most powerful AI chips in the world will be made right here in America.”
As envisioned, the spending marks one of the largest outlays by a foreign firm in US manufacturing. The spending adds to US$65 billion in planned TSMC investments in the US and would eventually bring its American presence to a half-dozen plants for advanced wafer fabrication and a couple more for advanced packaging.
Photo: Bloomberg
“Without the semiconductors, there is no economy powering everything from AI to automobiles to advanced manufacturing,” Trump said from the Roosevelt Room.
TSMC is the world’s leader in production of advanced semiconductors used for AI, and it serves as the main chip manufacturing partner for Nvidia Corp and Apple Inc. Following the announcement, Nvidia said it would rely on the new TSMC plants to anchor a resilient technology supply chain in the US.
“We’re going to produce many chips to support AI progress and to support the smartphones’ progress, and we thank President Trump again for his support,” Wei said, adding the moves will create thousands of high-tech manufacturing jobs.
Additional spending by TSMC in the US will be reviewed by Taiwan’s government "in accordance with the law," Cabinet spokesperson Michelle Lee (李慧芝) said today.
The review will take into account "the company's development while ensuring the overall competitiveness of the semiconductor industry and the country," Lee said.
"The close cooperation in high-tech industries between Taiwan and the United States has made Taiwan the most important partner for the United States in maintaining its leading position in high-tech and technology industries," she said.
"In the future, our country will continue to strengthen cooperation to create mutual benefits and win-win results."
TSMC’s investment plans support Trump’s goal of making the US dominant in AI, and they marked the latest major technology investment since his return to power. Companies including Apple, OpenAI and Meta Platforms Inc have pledged more than US$1 trillion in spending, though the scope of those commitments remains unclear. Some investments may include previously planned spending.
“Trump again stressed tariffs’ role in bringing more manufacturing to the US, but we believe it is political pressure, rather than tariffs” that spurred TSMC’s decision, Sanford C. Bernstein & Co analysts including Mark Li wrote. “A larger US scale may imply heavier cost, but possibly may also provide scale benefits and lower cost.”
Yesterday’s announcement comes as Trump weighs tariffs against a wide range of industries — including semiconductors, lumber, autos and pharmaceuticals — to address what he sees as global trade imbalances that hurt the US. Levies on chips would hit hard in Taiwan, where a vast majority of the world’s most advanced wafers, especially those used in AI, are made.
Trump has repeatedly accused Taiwan of “stealing” the US semiconductor industry and threatened tariffs on foreign-produced chips, as top US officials have consistently affirmed their commitment to boosting domestic manufacturing. That’s particularly true for technologies like AI and semiconductors at the heart of US-China competition.
“By doing it here, he has no tariffs,” Trump said, when asked yesterday about the role his tariff threats have played in influencing companies’ decisions to invest in the US.
The US president has expressed a preference for using tariffs to spur US chipmaking instead of government subsidies, the approach favored under former president Joe Biden, who pushed for passage of the CHIPS and Science Act to revive the domestic industry. That legislation, signed in 2022, led to TSMC winning US$6.6 billion in grants to support three plants in Phoenix.
Future implementation of CHIPS Act programs, however, remains clouded by the prospect of significant staffing reductions as Trump moves to slash the federal workforce. The US government office responsible for the marquee US$52 billion subsidy program will lose about two-fifths of its staff, according to people familiar with the matter.
Trump administration officials have also approached TSMC about possibly taking a controlling stake in Intel Corp’s factories, Bloomberg News reported previously. Those talks remain in the early stages but the move is aimed at addressing concerns about Intel’s deteriorating financial state, which has forced it to eliminate jobs and curb global expansion plans.
TSMC’s first facility in Arizona is now up and running, and its early production yields there have surpassed those at similar factories back home. Advanced Micro Devices Inc chief executive officer Lisa Su (蘇姿丰) yesterday hailed the Trump administration’s effort to encourage domestic manufacturing and said her company was already working with TSMC as a leading customer at that plant.
“We are looking forward to being able to say our highest-performance products coming are being produced in the US starting later this year,” Su said in a statement.
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