TSMC confirms $12 billion 5nm plant in Arizona

As expected, here's the announcement from TSMC about its intention to build a fab in the US. The Taiwanese foundry plans to build a $12 billion fab in Arizona, this facility will employ over 1600 people and will satisfy the Trump administration's goal to become less reliant on foreign countries. TSMC says construction is expected to start in 2021. Mass production of 5nm chips at the Arizona plant should kick off in 2024.

The $12 billion capital expenditure projected for this fab is spread over the next nine years so it's a relatively minor investment for TSMC considering the foundry has an annual capex of $15 billion to $15 billion. TSMC's Arizona plant is expected to be able to process up to 20,000 wafers per month.

TSMC (TWSE: 2330, NYSE: TSM) today announced its intention to build and operate an advanced semiconductor fab in the United States with the mutual understanding and commitment to support from the U.S. federal government and the State of Arizona.

This facility, which will be built in Arizona, will utilize TSMC’s 5-nanometer technology for semiconductor wafer fabrication, have a 20,000 semiconductor wafer per month capacity, create over 1,600 high-tech professional jobs directly, and thousands of indirect jobs in the semiconductor ecosystem. Construction is planned to start in 2021 with production targeted to begin in 2024. TSMC’s total spending on this project, including capital expenditure, will be approximately US$12 billion from 2021 to 2029. This U.S. facility not only enables us to better support our customers and partners, it also gives us more opportunities to attract global talents. This project is of critical, strategic importance to a vibrant and competitive U.S. semiconductor ecosystem that enables leading U.S. companies to fabricate their cutting-edge semiconductor products within the United States and benefit from the proximity of a world-class semiconductor foundry and ecosystem.

TSMC welcomes continued strong partnership with the U.S. administration and the State of Arizona on this project. This project will require significant capital and technology investments from TSMC. The strong investment climate in the United States, and its talented workforce make this and future investments in the U.S. attractive to TSMC. U.S. adoption of forward-looking investment policies to enable a globally competitive environment for a leading edge semiconductor technology operation in the U.S. will be crucial to the success of this project. It will also give us the confidence this and other future investments by TSMC and its supply chain companies will be successful.

In the United States, TSMC currently operates a fab in Camas, Washington and design centers in both Austin, Texas and San Jose, California. The Arizona facility would be TSMC’s second manufacturing site in the United States.