Good yield rates in Arizona show strong manufacturing, execution: TSMC

Taipei, Oct. 25 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, said on Friday that good yield rates at its first wafer fab in the U.S. state of Arizona demonstrate the company's strong manufacturing capacity and execution of the project.

In a statement, TSMC cited TSMC Chairman C.C. Wei (魏哲家) as saying at an investor conference held earlier this month that the Arizona project is proceeding very well.

TSMC's first fab entered engineering wafer production in April using the advanced 4-nanometer process, and the outcome was "highly satisfactory, with a very good yield," Wei said at the investor conference.

"This is an important operational milestone for TSMC and our customers, demonstrating the company's strong manufacturing capability and execution," Wei said, as cited in the statement.

The statement came after a Bloomberg report which cited Rick Cassidy, president of TSMC Arizona as saying earlier in the day that the yield rate of the fab was about 4 percentage points higher than comparable facilities in Taiwan, showing progress in Washington's efforts to revitalize American semiconductor production.

While TSMC did not disclose yield rates at the Arizona fab, the chipmaker quoted Wei as saying the yield rates have been satisfactory.

A yield rate is a measure of how many usable chips can be produced during a single manufacturing process.

Through TSMC Arizona, the chipmaker has invested more than US$65 billion in Arizona, and the first fab there is expected to start mass production of chips using the 4nm process by the first half of 2025.

The second Arizona fab, which is currently under construction, is scheduled to start commercial production in 2028, rolling out chips with the 3nm and 2nm processes. The 3nm process is the most recent technology TSMC started commercial production.

In April, TSMC announced plans to build a third fab in Arizona, and set a goal of starting production on the 2nm process or more advanced technologies by 2030, with the aim of meeting strong demand from clients in the U.S.

Also in April, the U.S. Department of Commerce said it had signed a non-binding preliminary memorandum of terms (PMT) with TSMC for up to US$6.6 billion in direct funding and up to US$5 billion in loans under the CHIPS and Science Act. The deal is not realized yet and has been criticized by Republican presidential candidate Donald Trump.

Trump said as Taiwan is "immensely wealthy" the U.S. should not be giving it "billions of dollars to build chips."

According to TSMC, the chipmaker plans to apply for U.S. Treasury Department Investment Tax Credits worth up to 25 percent of the qualified capital expenditure at TSMC Arizona.