TSMC Removes Chinese Equipment from Advanced Chip Plants Amid US-China Tensions

Taiwan Semiconductor Manufacturing Co Ltd has removed Chinese equipment from its advanced chip plants, focusing on research and development of 3nm and 2nm process technologies. The company's product range covers various electronic applications, including personal computers, information products, communication systems, and data centers.

Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) has taken a significant step in its semiconductor manufacturing operations by phasing out Chinese-made equipment from its advanced 2-nanometer (nm) chip plants. This move, aimed at reducing regulatory risks and ensuring continued access to US subsidies, aligns with the proposed US Chip EQUIP Act [1].

TSMC's decision to exclude Chinese equipment from its 2 nm production lines comes as the company ramps up mass production at its facilities in Hsinchu and Kaohsiung, with plans to expand operations in Arizona, US. The shift is part of a broader strategy to diversify its supply chain and safeguard its position in the global semiconductor market [2].

The 2 nm process is considered one of the most sophisticated in the industry, and TSMC's move to replace Chinese-made tools is a direct response to anticipated US regulations. The proposed Chip Equipment and US Protection (EQUIP) Act, introduced in 2024, prohibits chipmakers from receiving US funding if they continue to use equipment supplied by foreign entities that pose a concern to national security [1].

TSMC's decision to phase out Chinese equipment is not only a response to US regulations but also a strategic move to reduce its reliance on Chinese inputs. The company is reviewing its procurement of materials and chemicals, aiming to reduce dependency on Chinese suppliers for its operations in Taiwan and the US while continuing to source locally for its facilities in China [1].

The move comes amidst volatile US-China trade relations. Tariffs between the two sides peaked this year before both governments agreed to a 90-day truce in May 2025, which was extended to November 10, 2025. Under the truce, US tariffs dropped to 30 per cent and China’s to 10 per cent [1].

TSMC's product range covers various electronic applications, including personal computers, information products, communication systems, and data centers. The company's commitment to advanced process technologies, such as 3 nm and 2 nm, positions it as a leader in the semiconductor industry [3].

References:
[1] https://www.business-standard.com/companies/news/tsmc-2nm-plants-phase-out-chinese-equipment-us-policy-risks-125082500677_1.html
[2] https://wccftech.com/tsmc-removing-chinese-chipmaking-equipment-from-its-2nm-production-lines/
[3] https://www.marketscreener.com/news/tsmc-unit-tsmc-global-acquires-fixed-income-securities-for-12-7-million-ce7c50dbd08dff2c