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TSMC to reveal plans for another US chip plant, WSJ says

Taiwan Semiconductor Manufacturing Co. aims to build another chip manufacturing plant in Arizona on top of a $12 billion complex it has already committed to.

Taiwan Semiconductor Manufacturing Co. aims to build another chip manufacturing plant in Arizona on top of a $12 billion complex it is already committed to, the Wall Street Journal reported, citing people familiar with the plans.

The world’s largest contract chipmaker will announce its intention to set up another facility north of Phoenix, adjacent to the factory under construction, the Journal reported. The new investment should be similar to the first project, he added. Company representatives did not respond to requests for comment.

The Biden administration is seeking to attract investment in US chipmaking, as part of efforts to counter China’s ambitions and secure components vital to national security. That effort accelerated after widespread shortages that began in late 2020 and 2021 showed that chips were critical to the production of everything from cars to smartphones.

Washington, which offers incentives of some $50 billion for local projects, has hailed TSMC’s expansion in Arizona as a triumph in efforts to bring advanced chip manufacturing back to the United States. But the Taiwanese company has said it costs much more to make semiconductors in the US, though that higher cost can be managed with state support.

TSMC, whose production sites are primarily in Taiwan, has begun to diversify over the past year to help meet demand in major countries seeking to boost domestic semiconductor production. It joins rivals like Samsung Electronics Co., which is also setting up a $17 billion factory in Texas.

The company is building a $7 billion facility in Japan, and is also in early talks with the German government about possibly establishing a plant in the European country, Bloomberg News reported.

A major expansion of TSMC’s US plans would boost the Biden administration’s overall efforts to ensure the country stays ahead of China in the semiconductor race.

In addition to boosting incentives for local chip manufacturing, the US has imposed a host of restrictions on shipping advanced technology to China, with the aim of strangling the flow of chips that help Beijing’s military and tech sector.

Xi Jinping, in a landmark speech last month, promised technological self-sufficiency to prevail in a battle with the US for technological supremacy, which many took as a sign that Beijing will double down on policy and financial support for sectors like AI and chips.

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