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Chipmaker TSMC sees expansion of planned Arizona sources

FILE PHOTO: A logo from Taiwan Semiconductor Manufacturing Co (TSMC) is seen at the headquarters in Hsinchu, Taiwan on August 31, 2018. REUTERS / Tyrone Siu

Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) (2330.TW) plans to build several more chip factories in the US state of Arizona in addition to what is currently planned, three people familiar with the matter told Reuters.

TSMC, the world’s largest chip chip maker, announced in May 2020 that it would build a $ 12 billion plant in Arizona, a clear victory for the Trump administration in its push to fight global technology supply chains back from China.

TSMC is setting up a 12-inch wafer plant in Phoenix, and the plant is expected to start volume production in 2024, Taiwan’s Investment Commission from the Ministry of Economic Affairs, which approved the investment, said in December.

TSMC manufactures most of its chips in Taiwan and has older chip facilities in China and the US state of Washington.

Three sources familiar with the matter spoke on condition of anonymity as they were not authorized to speak to the media, Reuters said up to five additional factories are planned for Arizona.

The original factory is relatively modest by industry standards with a planned production of 20,000 wafers – each containing thousands of chips – each month using the company’s most sophisticated 5 nanometer semiconductor manufacturing technology.

It is not clear how much extra production capacity and investment the extra factories can represent and what chip production technology they will use.

TSMC said last month that it planned to invest $ 100 billion over the next three years to increase production capacity, although they did not provide details. Read more

A person with direct knowledge of the case told Reuters that the expansion was in response to a request from the United States, but refused to provide further details.

“The United States requested it. Internally, TSMC plans to build up to six factories,” the person said, adding that it was not possible to provide a time frame.

The Biden administration is preparing to spend tens of thousands of billions of dollars to support domestic chip production. Under existing law, foreign companies are eligible for these funds, but whether they will eventually receive it is an open question.

Another person familiar with the plans said the company had already made sure there was enough room for expansion when they got the land for the first plant.

“That’s how they can build six factories,” the source said.

The third person, from a TSMC vendor involved in the Arizona project, said TSMC had told them the plan was to build a total of six factories over the next three years.

Reuters was unable to independently confirm the time frame.

TSMC referred to comments from CEO CC Wei on an earnings call last month, saying the company started chip production in Arizona in 2024 with a 20,000 wafer per month 5-nanometer technology.

“But in fact, we have acquired a large piece of land in Arizona to provide flexibility. So further expansion is possible, but we will first ramp up to Phase 1, then based on operating efficiency and cost economy and also customer demand, to decide what they next step we must take. “Asked whether the planned enlargement was due to a request from the United States, TSMC said it was” not sure “what is meant by” requests “from the United States and that it will decide the next steps based on operational efficiency, cost economy and customer demand.

“When there is any official decision, we publish it accordingly.”

Our standards: Thomson Reuters Trust Principles.

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