TSMC begins construction on 2nd semiconductor fabrication plant in US Arizona

Adam Yanelli


HOUSTON (ICIS)–Taiwan Semiconductor Manufacturing (TSMC) has begun construction on a second semiconductor fabrication plant in Arizona, the company announced on Tuesday.

Known in the industry as a fab, the new plant will produce 3nm process technology when it begins operations in 2026.

The company’s first plant at the site will produce N4 process technology when it starts up in 2024.

The overall investment for the two fabs is $40bn, the company said.

When complete, TSMC’s two fabs in Arizona will manufacture more than 600,000 wafers per year, with estimated end-product value of more than $40bn.

A global shortage of semiconductors has been the biggest impediment to the automobile industry, which is a major end market for chemicals.

The tight market led to discussions of improving domestic production of microchips, which are used to control the engine, antilock brakes, power steering, fuel-monitoring system and heating and air conditioning in modern vehicles.

The Semiconductor Industry Association (SIA) said the US had 37% of global semiconductor manufacturing capacity in 1990, but only 12% of global capacity in 2022.

US President Joe Biden signed the Chips and Science Act of 2022 in August.

Part of the law is designed to bolster domestic production of semiconductors, as well as fund research and development, workforce development, international information and communications technology security and semiconductor supply chain activities, and advanced wireless communication technologies.

It also established a 25% investment tax credit for investments in semiconductor manufacturing, including the manufacturing of specialised equipment required for microchip production, and authorises funding for research and innovation programs.

US semiconductor producer Intel announced earlier this year plans to invest $20bn to build two new fabs in Ohio.

The company began construction in September with production expected to come online in 2025.


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