TSMC to build $12 billion, 5nm plant in Arizona

What just happened? The Taiwan Semiconductor Manufacturing Company (TSMC) has officially confirmed it would build a new chip factory in the US. The $12 billion plant is being constructed in Arizona, with work set to begin next year and the first chips expected to arrive in 2024.

This week brought reports that TSMC was planning to build a factory in the US. Today, the company confirmed it. The manufacturer said the plant would utilize its 5nm technology, have a 20,000 semiconductor wafer per month capacity, and create over 1,600 high-tech professional jobs.

The news has been welcomed by the US government, which has long been requesting TSMC move some of its semiconductor operations from Asia to the US to avoid security issues. In addition to producing chips for the likes of Apple, Qualcomm, and Nvidia, it also makes them for the US military, including those used in F-35 fighter jets.

Last year, Chinese President Xi Jinping said Beijing would not rule out using force to unite China and Taiwan. With the possibility of China taking control of the island, the US doesn’t want its chips within reach of its military and tech rival. As such, the US government wants the firm to make the components in America.

TSMC had said making chips in the US was not the answer to its security worries, but the company later softened its stance, saying in January that it never ruled building or acquiring another fab in America— it already operates a smaller factory in Washington.

The U.S. welcomes TSMC’s intention to invest $12B in the most advanced 5-nanometer semiconductor fabrication foundry in the world. This deal bolsters U.S. national security at a time when China is trying to dominate cutting-edge tech and control critical industries.

— Secretary Pompeo (@SecPompeo) May 15, 2020

The company said it “welcomes continued strong partnership” with the US government and state of Arizona, and Secretary of State Mike Pompeo tweeted his approval.

TSMC has already started producing 5nm chips at its Taiwan plant. It’s expected that the A14 SoC in this year’s iPhone 12 will be based on the technology, as will the rumored A14X chip in a future iPad Pro model, and AMD’s Zen 4 chips—though all these will have arrived long before the factory is operational. We’ve also heard that Nvidia is planning a mystery 5nm product, likely based on it post-Ampere Hopper architecture.