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Chip maker TSMC scores subsidies, picks site for US$12 billion US plant

  • TSMC’s decision to build a plant in Arizona came after White House officials warned about the threat inherent in having much of the world’s electronics made outside the US
  • The Taiwanese company is the main contract chip manufacturer to Apple and Huawei Technologies

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For Huawei Technologies chip supplier Taiwan Semiconductor Manufacturing Co, it is growing ever more difficult to remain neutral amid the growing tensions between the US and China. Photo: EPA-EFE

Taiwan Semiconductor Manufacturing Co (TSMC) has secured government subsidies for its envisioned US$12 billion chip plant in Arizona, moving closer towards finalising a fabrication facility designed to allay national security concerns and shift hi-tech manufacturing to America.

TSMC, the main chip maker to Apple and Huawei Technologies, has picked a site for the plant, and both federal and state governments have agreed to help make up for the higher cost of fabricating semiconductors in the US, chairman Mark Liu told reporters on Tuesday. Negotiations continue over the specifics of those incentives, he said without elaborating or identifying the site’s location.
The decision to build a plant in Arizona came after White House officials warned about the threat inherent in having much of the world’s electronics made outside the US. TSMC had negotiated a deal with the Trump administration to create American jobs and produce sensitive components domestically for national security reasons.

TSMC announced the project just before Washington levelled new restrictions on the sale of chips to Huawei, seeking to contain one of the Taiwanese company’s largest customers.

Mark Liu, chairman of Taiwan Semiconductor Manufacturing Co, speaks at the company's annual general meeting in Hsinchu, Taiwan, on June 9. Photo: Bloomberg
Mark Liu, chairman of Taiwan Semiconductor Manufacturing Co, speaks at the company's annual general meeting in Hsinchu, Taiwan, on June 9. Photo: Bloomberg

The Taipei-based chip maker has set aside land near its selected plot and hopes to convince its own suppliers to set up operations in the vicinity over time, Liu said. They would join the likes of Intel Corp and Micron Technologies, which already operate facilities in the western state and have helped build a vibrant local semiconductor industry over the years. The scope of any eventual subsidies would require blessing from the US Congress, Liu added.

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