TSMC Arizona to receive US$6.6 billion from Biden administration

Washington, Nov. 15 (CNA) The U.S. Department of Commerce said Friday that it will subsidize contract chipmaker TSMC Arizona US$6.6 billion to assist in its construction of three fabs in the state of Arizona.

In a news release, the department said it signed a final agreement with TSMC Arizona, a Taiwan Semiconductor Manufacturing Co. (TSMC) subsidiary, and that the funds will be available as part of the CHIPS and Science Act.

The subsidy comes after a previously signed preliminary memorandum of terms announced on April 8 this year, and will be distributed as TSMC Arizona hits project milestones, according to the release.

U.S. President Joe Biden was quoted in the statement saying that the agreement with TSMC "will spur US$65 billion dollars of private investment" and "create tens of thousands of jobs by the end of the decade."

The first of the fabs is expected to be fully operational early next year, which will mark "the first time in decades an American manufacturing plant will be producing the leading-edge chips used in our most advanced technologies," Biden said, describing Friday's announcement as one of the "most critical milestones yet in the implementation of the bipartisan CHIPS and Science Act."

Biden pointed out that the U.S. "invented semiconductors and used to manufacture nearly 40 percent of the world's chips, but now makes closer to 10 percent of them and none of the most advanced chips."

He said he came to office determined to change that and has since delivered on the promise, generating private investment in semiconductors, creating new construction and manufacturing jobs, and reshoring critical technologies to strengthen the economic security of the U.S.

TSMC Chairman and CEO C.C. Wei (魏哲家) was also quoted in the statement echoing the sentiment that the signing of the agreement will accelerate TSMC's development in the U.S. and strengthen the semiconductor ecosystem in the U.S.

"TSMC appreciates the continual collaboration with customers, partners, local communities and the U.S. government beginning in early 2020," Wei said.

TSMC Arizona's first fab is expected to begin manufacturing 4 nanometer (nm) chips in the first half of 2025. The second fab is planned to start manufacturing 3nm and 2nm chips in 2028, while the last plant is expected to manufacture 2nm or more advanced chips.