If Taiwan Semiconductor Manufacturing Co (TSMC) increases its investment in Arizona, it would likely operate dual production hubs in Taiwan and the US, with US capacity nearly sufficient to meet that country’s local demand, an economist said yesterday.
Liu Pei-chen (劉佩真), a researcher at the Taiwan Institute of Economic Research, was responding to a New York Times report which said TSMC could build more chip facilities in Arizona as part of a tariff deal with the US.
TSMC would commit to building more factories in the US in exchange for a reduction in the standard duty on imported goods from Taiwan to 15 percent from 20 percent, the report said.
Photo: Bloomberg
The chipmaker could build new advanced wafer fabs as well as IC packaging and testing facilities as part of the arrangement, Liu said.
The number of TSMC fabs in Arizona would likely rise to six to eight, with total monthly production capacity of at least 150,000 wafers, which would come close to meeting the demand for high-performance computing and artificial intelligence chips in the US, she said.
That would be considered a gamble for Taiwan, given that many in the country believe TSMC offers the country a “silicon shield,” as some countries such as the US need TSMC’s advanced chips.
Should those chips all be made and packaged in the US, Washington might be less likely to support Taiwan in deterring a potential attack by China.
TSMC could build more advanced IC assembly plants to provide advanced 3D chip-on-wafer-on-substrate and system-on-integrated-chips IC packaging services to its clients, establishing the US as a complete semiconductor hub, Liu said.
A one-stop comprehensive production model in which TSMC rolls out chips and provides assembly services would meet demand from its US clients such as Nvidia and Advanced Micro Devices (AMD) to lower their risks at a time of geopolitical unease, she said.
“If TSMC builds new wafer fabs in Arizona, a dual-hub production model will take shape, gradually moving away from the current model of a single hub in Taiwan,” Liu said.
However, costs could become an issue for such a model, she said.
TSMC faces extremely high depreciation costs due to the high expense of building production capacity in the US, and it would also have to adjust the utilization rates of its fabs in Taiwan, which could affect the company’s bottom line, she added.
TSMC is investing US$65 billion to build three advanced wafer fabs in Arizona. The first fab started mass production in the fourth quarter of 2024.
The structure for the second fab was completed last year, with volume production targeted for 2028.
Ground was broken on a third fab in April last year.
In March last year, TSMC pledged to invest an additional US$100 billion to build three more fabs, two IC assembly plants and a research-and-development center.
The government did not comment on the New York Times report, while TSMC has been quiet before its latest investor conference tomorrow.
Japanese footwear brand Onitsuka Tiger today issued a public apology and said it has suspended an employee amid allegations that the staff member discriminated against a Vietnamese customer at its Taipei 101 store. Posting on the social media platform Threads yesterday, a user said that an employee at the store said that “those shoes are very expensive” when her friend, who is a migrant worker from Vietnam, asked for assistance. The employee then ignored her until she asked again, to which she replied: "We don't have a size 37." The post had amassed nearly 26,000 likes and 916 comments as of this
US President Donald Trump said "it’s up to" Chinese President Xi Jinping (習近平) what China does on Taiwan, but that he would be "very unhappy" with a change in the "status quo," the New York Times said in an interview published yesterday. Xi "considers it to be a part of China, and that’s up to him what he’s going to be doing," Trump told the newspaper on Wednesday. "But I’ve expressed to him that I would be very unhappy if he did that, and I don’t think he’ll do that," he added. "I hope he doesn’t do that." Trump made the comments in
Tourism in Kenting fell to a historic low for the second consecutive year last year, impacting hotels and other local businesses that rely on a steady stream of domestic tourists, the latest data showed. A total of 2.139 million tourists visited Kenting last year, down slightly from 2.14 million in 2024, the data showed. The number of tourists who visited the national park on the Hengchun Peninsula peaked in 2015 at 8.37 million people. That number has been below 2.2 million for two years, although there was a spike in October last year due to multiple long weekends. The occupancy rate for hotels
A cold surge advisory was today issued for 18 cities and counties across Taiwan, with temperatures of below 10°C forecast during the day and into tonight, the Central Weather Administration (CWA) said. New Taipei City, Taipei, Taoyuan and Hsinchu, Miaoli and Yilan counties are expected to experience sustained temperatures of 10°C or lower, the CWA said. Temperatures are likely to temporarily drop below 10°C in most other areas, except Taitung, Pingtung, Penghu and Lienchiang (Matsu) counties, CWA data showed. The cold weather is being caused by a strong continental cold air mass, combined with radiative cooling, a process in which heat escapes from
RSS