President Trump said Monday that the world's largest chip maker, Taiwanese semiconductor manufacturer, will spend $100 billion in the US over the next four years, expanding its production capacity and bringing the most sophisticated semiconductor processes to its operations in Arizona.
The investment will allow TSMC to start manufacturing artificial intelligence and smartphone chips in Arizona, Trump said.
With its commitment, TSMC will bring planned total US spending to $165 billion. The funding will expand the company's footprint in Arizona from three manufacturing plants to five, adding 25,000 jobs and creating a research and development center to develop future production processes.
The expansion of TSMC comes after years of work to improve domestic manufacturing of semiconductors. For more than five years, Washington officials have been concerned that TSMC's chip industry control has created national security risks. They feared that the US could lose access to the sophisticated chips produced in Taiwan as Beijing wanted to reclaim the island as part of China.
The previous Trump administration began lobbying TSMC to build plants in the United States. The Biden administration has advanced these efforts by passing the CHIPS Act. It provided $39 billion in federal funding to create small electronics that will enhance everything from cars to iPads for the construction of new and expanded manufacturing facilities.
During the White House event, Trump said TSMC's investment would reduce national security risks in the United States and encourage other companies to create more products in the United States.
“Semiconductors are the backbone of the economy of the 21st century, and in reality there is no economy without semiconductors,” Trump said, adding that “we must be able to build the chips and semiconductors needed in American factories with American skills and American labor.”
He appeared alongside TSMC CEO CC Wei Trump, who said the company will begin manufacturing AI chips and smartphone chips in the United States. He added that factory expansions, including Apple, Nvidia, AMD, Qualcomm and Broadcom, were supported by American customers.
Trump said the investment would help TSMC avoid tariffs of more than 25% on chips manufactured in Taiwan. Since taking office in January, he has threatened 100% tariffs on Taiwan's chips, criticizing the Chip Act for not being able to create more chips domestically.
Since Trump took office in January, TSMC and Taiwanese officials have been rushing to deal with his tariff threats. In January, Wey met with Howard Lutnick, Secretary of Commerce, on the investments that TSMC could make. They investigated the possibility that TSMC would invest in US chipmaker Intel. Taiwanese officials also traveled to Washington and raised the deal to invest in the US.
The investment more than doubles TSMC's commitment to the US, increasing the ability of chips to produce in Arizona.
Under the Chips Act, TSMC had pledged to invest $65 billion to build three factories in Arizona. The production process it promises to bring to the US is a legacy technology that creates chips that are more refined than those produced in Taiwan. We received $6.6 billion in federal funds to support the project.
TSMC, which will appear on Monday, will be the latest in a series of companies to visit the White House and make investment commitments. In January, Openai, Oracle and Softbank promised to spend $500 billion on data centers over the next four years. Last month, Apple CEO Tim Cook met with Trump before pledging to spend $500 billion over four years.
“They want to be in the world's greatest market, so they're coming here in huge sizes. They want to avoid tariffs,” Rutnick said at an event Monday. “If they're not here, they need to suffer.”
