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Taiwan Semiconductor To Ramp Up US Chip Investment: Reuters

  • Taiwan Semiconductor Manufacturing Co Ltd (NYSE: TSM) plans to channelize incremental billions of dollars into the Arizona chip factories from its previously disclosed plans, Reuters reports.
  • TSM remains indifferent regarding the European plant plans.
  • Last year, TSM had announced an investment of $10 billion and $12 billion in the Phoenix chip factory. The company now plans around five additional fabs in Arizona apart from the current one.
  • Opinions remain divided over the next plant focus between the advanced 3-nanometer chipmaking technology and the slower, less-efficient 5-nanometer technology used for the first factory. The 3-nanometer plant could cost between $23 billion and $25 billion.
  • TSM could join the likes of Intel Corp (NASDAQ: INTC) and Samsung Electronics Co Ltd (OTC: SSNLF) to seek subsidies from the U.S. government.
  • President Joe Biden has sought $50 billion in funding for domestic chip manufacturing. However, concerns about the misuse of the subsidies remain for higher R&D plans in favor of Taiwan instead of U.S. interests.
  • Interestingly, European chip and auto companies seek subsidies for the short supply of older-generation chips used by car manufacturers.
  • TSM’s European customer base comprises mainly less advanced chips utilized by automakers.
  • TSM is still open to the possibility of an older-generation auto chip plant in Europe.
  • TSM has hired Intel veteran Benjamin Miller as human resources head in Arizona. It has hired 250 engineers, out of which 100 have been sent to Tainan, Taiwan, for a training program.
  • TSM’s first Arizona factory will have an estimated output of 20,000 wafers of 12-inch silicon discs that can each contain thousands of chips per month.
  • However, TSM’s fabs in Taiwan can produce 100,000 wafers per month.
  • Price action: TSM shares traded higher by 1.67% at $110.57 in the premarket session on the last check Friday.

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