Difficult to resist the temptation of the United States? TSMC to build a US$12 billion factory in the United States!
Since Trump took office, he has been working to bring manufacturing back to the United States, and for this reason, he has continued to win over major semiconductor industry giants. As he said in an exclusive interview with Fox Financial News: “We shouldn’t have a supply chain, everything should be in the United States.”
As early as May 11, the Trump administration wanted Intel and TSMC to build chip factories in the United States, citing reducing the United States’ reliance on components made in China, South Korea and Taiwan. TSMC did not give a clear response to this. TSMC CEO Liu Deyin also stated in public that TSMC will not build factories in the United States because of the requirements of the US government, and will only respond to consumer requests.
However, just today, TSMC suddenly responded: with the mutual understanding and support of the US federal government, an advanced semiconductor factory will be built and operated in Arizona, USA.
It is understood that TSMC’s Arizona factory will utilize TSMC’s 5nm technology for semiconductor wafer manufacturing, with a monthly production capacity of 20,000 semiconductor wafers, directly creating more than 1,600 high-tech professional jobs, and creating thousands of indirect jobs in the semiconductor ecosystem Position.
Construction of the chip factory is scheduled to begin in 2021, with target production starting in 2024. TSMC’s total spending on the project, including capital expenditures, is about $12 billion between 2021 and 2029. TSMC said the U.S. factory not only allows us to better support customers and partners, but it also gives us more opportunities to attract global talent.
TSMC said the U.S. factory not only allows us to better support customers and partners, but it also gives us more opportunities to attract global talent.
Why does the United States keep calling TSMC from the air?
TSMC is the world’s largest chip foundry, with a market share of 54.1% in the foundry field. In 2019, TSMC’s revenue was about 253.385 billion yuan, and its net profit was about 83.806 billion yuan. In the first quarter of this year, TSMC’s revenue was US$10.306 billion, or about 73.49 billion yuan.
The reason why TSMC can achieve substantial revenue is because of its advanced product technology. Taking the 7-nanometer process as an example, the unit price of this kind of wafer is expensive, which makes TSMC’s single wafer revenue higher than that of its peers. At present, TSMC has mass-produced 7nm, and the mass production of 5nm advanced process is ready, and it can be put into mass production at any time, and has received 5nm process orders from Apple and Huawei. It is expected that the contribution rate of 5nm process to revenue will be close to 10% this year. For the more advanced 3nm process, TSMC said it will conduct trial production by the end of 2021. And with the advent of 5G, the flow of computing power is on the rise. The semiconductor industry’s reliance on advanced processes will also expand further. In principle, whoever has the more advanced process can seize the market machine.
Could TSMC’s U.S. plant bring a revival to U.S. manufacturing?
This project is of strategic importance to the vibrant and competitive U.S. semiconductor ecosystem, which will enable some U.S. companies to manufacture their cutting-edge semiconductor products within the U.S. and benefit from world-class semiconductor foundries and Proximity of ecosystems.
In the US, TSMC currently has a fab in Camas, Washington, and design centers in Austin, Texas, and San Jose, California. The Arizona facility will be TSMC’s second U.S. production site.
Shortly after TSMC’s official announcement, U.S. Secretary of Commerce Wilbur Ross expressed his appreciation for TSMC’s announced plans to build a factory in the United States.
“TSMC’s plans to build a $12 billion semiconductor factory in Arizona once again demonstrate that President Trump’s policies have brought about a renaissance in U.S. manufacturing and made the United States the most attractive investment location in the world,” Ross said. “
He also mentioned that the semiconductor industry is critical to U.S. economic growth, underpinning many of the advanced technologies that consumers rely on, including smartphones, traffic safety applications, advanced medical devices and telecommunications. TSMC’s investment will solidify U.S. leadership in cutting-edge semiconductor design and manufacturing, and will further accelerate Arizona’s position as the center of the global technology industry.
Attachment: TSMC’s original announcement
TSMC announced today (15) that it intends to build and operate a state-of-the-art wafer fab in the United States with the joint understanding and support of the U.S. federal government and the state of Arizona.
The plant to be established in Arizona will use TSMC’s 5nm process technology to produce semiconductor chips, with a planned monthly production capacity of 20,000 wafers, which will directly create more than 1,600 high-tech professional job opportunities and indirectly create the semiconductor industry Thousands of jobs in the ecosystem. The fab will start construction in 2021 and start mass production in 2024. From 2021 to 2029, TSMC will spend about $12 billion on this project, including capital expenditures.
This advanced fab not only enables TSMC to provide better services to customers and partners, but also provides TSMC with more opportunities to attract global talent. This project is strategically important to the vibrant and competitive U.S. semiconductor ecosystem, enabling industry-leading U.S. companies to manufacture their state-of-the-art semiconductor products within the U.S. while benefiting from the Geographical proximity of world-class semiconductor wafer fabrication services companies and their ecosystems.
TSMC looks forward to continuing its strong partnership with the U.S. authorities and Arizona on this project, which requires substantial capital and technology investment by TSMC, and the robust investment environment and talent in the U.S. make this project and its future Investments in the US are very attractive to TSMC. The United States’ forward-looking investment policy has created a globally competitive environment for its industry-leading semiconductor technology operations that is critical to the success of this project. This is also TSMC’s confidence in the success of this investment and future investments with its supply chain partners.
TSMC currently has a fab in Camas, Washington, and design centers in Austin, Texas, and San Jose, California. The Arizona facility will be TSMC’s second manufacturing facility in the United States.