iPhone chip-maker TSMC invests $40bn in Arizona plants

Image credit: BBC

The largest manufacturer of computer chips in the world, TSMC, has announced plans to invest an additional $40 billion (£33 billion) in a huge US facility.

It is one of the largest foreign investments in American history.

As soon as the news broke, President Joe Biden and the CEO of the Taiwan-based company launched the Arizona factory.

The Biden administration is moving forward with plans to produce essential parts for everything from phones to military jets domestically.

TSMC is the top producer of microchips for other companies, including Apple.

At its facilities in Arizona, it will produce 3-nm and 4-nm semiconductors for iPhone CPUs. Semiconductors are frequently referred to as the “brains” of electronics, such as mobile phones, automobile components, and artificial intelligence (AI) systems.

According to TSMC Chairman Mark Liu, the first of the two semiconductor manufacturing sites is slated to debut in 2024. A total of $40 billion will be invested. The company has never invested more money outside of Taiwan.

Under the presidency of Donald Trump, the initial deal for TSMC to build a plant in the US was made in 2020. The magnitude of that investment has materially increased since the most recent statement.

At the launch event were several executives from technology companies that depend on TSMC production, including Nvidia and Advanced Micro Devices.

Apple’s CEO, Tim Cook, referred to it as a “major occasion.”

In August, President Biden signed a law allocating $280 billion (£232 billion) to the high-tech sector and scientific research in response to concerns that China was acquiring a technological advantage over the US. Investments for companies building computer chip manufacturing facilities in the US include tax incentives.

When relations between the two countries deteriorated, the action was taken.

This has been fanned by Beijing’s claims of Taiwan’s independence and its increasing assertiveness in Asia. Beijing views Taiwan as a portion of its territory that has to be united with the mainland, maybe by force. Taiwan does not believe this to be the case.

As a result, the US has placed limitations on who is allowed to purchase cutting-edge chip technology.

That has harmed China’s export-driven economy, which uses technology to produce and market everything from electric cars to phones.

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