On Monday, President Trump said that the Taiwan Semiconductor Manufacturing Company, the largest chip manufacturer in the world, will spend $ 100 billion in the United States in the next four years to expand its production capacity and bring its most advanced semiconductor processes to its operations in Arizona.
The investment will allow TSMC to start creating artificial intelligence and smartphone chips in Arizona, said Trump.
With the commitment, TSMC brings the total expenditure planned to the United States to $ 165 billion. The money will expand the company’s imprint in Arizona from three six production plants, will add 25,000 jobs and will create a research and development center to develop future production processes.
The expansion of TSMC comes after years of work to shoot the national production of semiconductors. For more than five years, Washington officials have been concerned that TSMC domain in the chip industry has created a national security risk. They feared that the United States could lose access to those advanced chips, produced in Taiwan, because Beijing wants to recover the island as part of China.
The previous Trump Administration has started to put pressure on TSMC to build plants in the United States. The Biden administration has advanced these efforts by overcoming the chips act, a bipartisan bill that has provided $ 39 billion of federal funding for the construction of new and expanded production plants to build the electronic tiny that feeds everything, from cars to iPads.
During an event of the White House, Trump said that TSMC’s investment would reduce the risk of American national security and encourage other companies to make more than their products in the United States.
“The semiconductors are the backbone of the 21st century economy, and really without semiconductors, there is no economy,” said Trump, adding that “we must be able to build chips and semiconductors that we need here in American factories, with American skills and American work”.
Next to Trump, CC Wei, CEO of TSMC, said that the company would start producing artificial intelligence chips and smartphones chips in the United States. He added that the expansion of the factory had been supported by American customers, including Apple, Nvidia, AMD, Qualcomm and Broadcom.
Trump said that the investment would help TSMC avoid rates of 25 percent or more on the chips manufactured in Taiwan. Since it came into office in January, he had threatened 100 % rates on Taiwan’s chips and criticized Chips Act for not having made companies such as TSMCs make more chips at national level.
Since Trump came in office in January, Tsmc and Taiwan officials got angry to respond to his tariff threats. In January, Wei met Howard Lutnick, the secretary of trade, on the investments that Tsmc could do. They explored the possibility that TSMC’s investments in the United States chipmaker, Intel, in an agreement that would see it control of the production operations of the Silicon Valley icon. Taiwanese officials also traveled to Washington and floated agreements to invest in the United States.
The investment more than doubles TSMC’s commitment to the United States and increases the skills of the chips it produces in Arizona.
Pursuant to Chips Act, TSMC had committed to investing $ 65 billion to build three factories in Arizona. The production process that had committed itself to bringing to the United States is a Legacy technology that makes chips less sophisticated than those it produces in Taiwan. He received $ 6.6 billion of federal funding to support the project.
With its appearance on Monday, TSMC will become the last of a series of companies to visit the White House and take investment commitments. In January, Openai, Oracle and Softbank promised to spend $ 500 billion on the date in the next four years. Last month, Tim Cook, CEO of Apple, met Mr. Trump before the company undertook to spend $ 500 billion in four years, with a little of that support that went to a new factory in Houston to create artificial intelligence servers.
“They come here of enormous dimensions because they want to be in the largest market in the world and want to avoid rates,” Lutnick said to the event on Monday. “If I’m not here, they should suffer.”