UPDATE 1-Chipmaker TSMC looking to expand planned plant sources in Arizona

UPDATE 1-Chipmaker TSMC looking to expand planned plant sources in Arizona

It is not clear how much additional production capacity and investment the additional fabs might represent, and which chip manufacturing technology they would use. The initial fab is relatively modest by industry standards, with a planned output of 20,000 wafers – each of which contains thousands of chips – every month using the company’s most sophisticated 5 nanometre semiconductor manufacturing technology. TSMC last month said it planned to invest $100 billion over the next three years to increase production capacity, though it did not give details.

TSMC manufactures the bulk of its chips in Taiwan and has older chip facilities in China and the U.S. state of Washington. TSMC is setting up a 12-inch wafer fabrication plant in Phoenix, and the facility is expected to start volume production in 2024, Taiwan’s investment commission of the ministry of economic affairs, which approved the investment, said in December.

Three sources familiar with the matter, speaking on condition of anonymity as they were not authorised to speak to the media, told Reuters that up to five additional fabs for Arizona are being planned. TSMC, the world’s largest contract chipmaker, announced in May 2020 it would build a $12 billion factory in Arizona, an apparent win by the Trump administration in its push to wrestle global tech supply chains back from China.

A second person familiar with the plans said the company had already made sure there was enough space for expansion when they obtained the land for the first plant. “It’s so they can build six fabs,” the source said. The Biden administration is preparing to spend tens of billions of dollars to support domestic chip manufacturing. Under existing legislation, foreign firms are eligible for those funds, but whether they will ultimately receive it is an open question.

“The United States requested it. Internally TSMC is planning to build up to six fabs,” the person said, adding that it was not possible to give a timeframe. One person with direct knowledge of the matter told Reuters the expansion was in response to a request from the U.S., but declined to provide further details.

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