The Biden administration is making a bold move to bolster the United States’ semiconductor industry by awarding up to $6.6 billion in grants to Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading maker of advanced microchips. This investment, part of the bipartisan CHIPS and Science Act, aims to bring cutting-edge semiconductor technology to American shores.
TSMC plans to use the funds to support the construction of its first major U.S. hub in Phoenix, where the company will build two plants and a third factory. This expansion will increase TSMC’s total investments in the United States to over $65 billion, a significant boost from the current $40 billion.
The Biden administration sees this investment as crucial for establishing a reliable domestic supply of semiconductors, which are essential for a wide range of products, from smartphones to fighter jets. Currently, only about 10 percent of the world’s chips are made in the United States, highlighting the need for increased domestic production.
This award to TSMC is the second largest under the CHIPS Act, following a recent $8.5 billion grant to Intel. The CHIPS Act, passed in 2022, allocated $39 billion to the Commerce Department to incentivize companies to build and expand chip plants across the country, as part of President Biden’s strategy to strengthen American manufacturing.
TSMC’s investment is expected to create thousands of direct manufacturing jobs and tens of thousands of construction jobs. The company’s expansion in the U.S. could have a significant impact on the global semiconductor supply chain, addressing vulnerabilities exposed by chip shortages during the pandemic.
With TSMC’s commitment to producing two-nanometer chips at its U.S. hub, the United States is poised to make significant strides in semiconductor technology. This move aligns with the Biden administration’s goal of increasing domestic production of the most advanced semiconductors, crucial for national security and technological innovation.
As TSMC ramps up its operations in the United States, other major chipmakers like Micron Technology and Samsung are also expected to receive grants to support their domestic facilities. This wave of investments signals a new era for American semiconductor manufacturing, positioning the country as a leader in the global chip industry.
