US Invests $6.6B in 2nm Semiconductors to Challenge China

USA Announces $6.6 Billion Grant to TSMC for Third Chip Plant in Arizona

The United States has announced a grant of $6.6 billion to Taiwanese company TSMC for the construction of a third production plant for chips in Arizona. In addition, TSMC will receive a $5 billion loan from the United States.

TSMC is investing over $65 billion in the construction of three semiconductor factories in Arizona. The third plant, expected to be completed before 2030, will focus on producing chips with 2 nm technology or more advanced.

President Joe Biden applauded TSMC’s investment, highlighting the company’s contribution to the broader U.S. strategy to enhance domestic semiconductor production. This aligns with the Biden administration’s efforts to support the CHIPS Act, passed in 2022, which provides $39 billion in direct grants, loans, and guarantees totaling $75 billion to attract semiconductor manufacturers to the United States.

Currently, the U.S. accounts for less than 10% of global chip production and lacks the capability to produce the most advanced chips. With these new investments, it is projected that by 2030, the U.S. will increase its share to around 20% of the world’s cutting-edge chip manufacturing.

Once fully operational, the three TSMC plants in Arizona will have the capacity to produce millions of advanced chips used in technologies such as 5G/6G, autonomous vehicles, and AI data center servers. Major clients of TSMC include AMD, Apple, NVIDIA, and Qualcomm.

Earlier plans by TSMC to invest $40 billion in the first two factories in Arizona faced setbacks due to workforce shortages and lack of incentives from the U.S. government. The first plant is set to commence production of 4 nm chips in the first half of 2025, while the second plant, delayed from 2026 to 2028, will produce 2 nm chips (in addition to initially planned 3 nm chips) thanks to the additional funding from the U.S. government.

/Reports, release notes, official announcements.