Under a preliminary agreement announced on Monday, Taiwan Semiconductor Manufacturing Company (TSMC) will get as much as A$17.56 billion in US grants and loans to build an additional plant in Arizona.
The US intends to award TSMC A$9.99 billion in grants and as much as A$7.57 billion in loans to help it construct its third facility in Arizona.
TSMC will construct a third factory in Phoenix, adding to two facilities in the state that are scheduled to begin production in 2025 and 2028.
TSMC’s third fabrication site will reportedly rely on next-generation 2-nanometer process technology and is expected to be operational before the end of this decade. The 2nm chips are essential to sectors including AI and defence. TSMC is planning to first make 2nm chips in Taiwan in 2025.
In total, the package will support more than A$98.42 billion in investments at the three plants by TSMC.
“For the first time ever, we will be making at scale the most advanced semiconductor chips on the planet here in the United States of America, with American workers,” US Commerce Secretary Gina Raimondo told reporters in a briefing ahead of the announcement.
TSMC is one of the world’s most important chipmakers, and supplies to companies including Apple and Nvidia.
The news of TSMC’s funding has emerged as reports earlier this week indicated that Samsung is weighing a decision to more than double its investment in its semiconductor business in Taylor, Texas, from A$25.86 billion it had committed two years ago to A$66.94 billion.
Furthermore, Samsung is expected to announce that it will build a second chip factory even as its first Texas-based facility which was expected to begin production this year, will now do so in 2025.
While Samsung is expanding its investment commitment in the US, it too will receive billions of dollars in subsidies from the US Chips Act. The Chips Act passed two years ago and earmarked A$80.63 billion in grants for projects supporting this industry.
Intel has already been granted A$12.93 billion under the Act last month for projects in Arizona, New Mexico, Oregon and Ohio. Intel’s total investment in the US over the next five years is projected to exceed A$152.13 billion.
