TSMC: Confident in CHIPS Act Funding Under Trump

Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, is confident that its funding under the CHIPS and Science Act (CHIPS Act) will continue under the Trump administration, according to TSMC's Chief Financial Officer (CFO), Wendell Huang. The CHIPS Act, signed into law by President Biden in August 2022, aims to boost the domestic semiconductor industry and counter China's dominance in the sector.

TSMC has been promised $6.6 billion under the CHIPS Act to help build three cutting-edge chip fabrication plants in Arizona. The company's first investment in Arizona was announced in May 2020, with the total investment in its three projects there eventually standing at over $65 billion. Much of the investments were committed after the Biden administration signed the CHIPS Act, indicating the company's confidence in the policy's long-term support.

Huang stated that the funding was expected to continue to roll in gradually under Trump as the fabrication plants pass construction and production milestones. He revealed that TSMC had already received the first batch of government support, amounting to $1.5 billion in funds, in the fourth quarter of 2023. This indicates that TSMC is confident in the continuity of CHIPS Act funding under the Trump administration, despite the President-elect's past criticism of the bill and its price tag.

The CHIPS Act is intended to restart the U.S. semiconductor industry and start competing against Chinese dominance in the chip manufacturing space. However, the amount set aside to jumpstart the industry cannot be the only source of capital to bring the US up to speed, according to Commerce Secretary Gina Raimondo. She has said leading-edge chip manufacturers have asked for $70 billion in funding for chip fabrication, more than the government initially expected to spend. Raimondo said the department is prioritizing projects that will be operational by 2030 and some "very strong" proposals from companies may never get funding through the act.

TSMC's confidence in CHIPS Act funding under Trump aligns with industry experts' expectations that the President-elect will leave the policy mostly intact due to its bipartisan support in Washington. TSMC's investment in Arizona is significant, with a total commitment of over $65 billion across three projects. This includes the construction of three cutting-edge chip fabrication plants, with the first plant starting production in the fourth quarter of 2021. The company has received $1.5 billion in government support so far, with more funding expected as the plants pass construction and production milestones.

Comparing TSMC's investment to other semiconductor companies' investments in the US, we can see that it is one of the largest. For instance, Intel has committed $20 billion to build two new plants in Arizona, while Samsung has committed $17 billion to build a new plant in Texas. Micron has committed $15 billion to build a new plant in Utah, and GlobalFoundries has committed $4.2 billion to build a new plant in New York.

TSMC's investment is also notable because it is one of the few companies that is investing in the most advanced chip manufacturing technologies. The company plans to manufacture 3-nanometer chips in Arizona, which are expected to be in high demand for applications such as artificial intelligence and 5G networks.



In conclusion, TSMC's confidence in CHIPS Act funding under Trump is well-founded, given the policy's bipartisan support and the company's significant investment in Arizona. The CHIPS Act is a crucial step in restarting the U.S. semiconductor industry and competing against Chinese dominance in the chip manufacturing space. TSMC's investment in Arizona is a significant contribution to the US semiconductor industry and is comparable to other major investments by semiconductor companies in the US.