Taiwan Semiconductor Manufacturing Co. (TSMC) has officially started producing advanced four-nanometer chips for U.S. clients at its facility in Arizona, according to Commerce Secretary Gina Raimondo. This marks a significant milestone in the Biden administration’s efforts to bolster semiconductor manufacturing in the United States.

In November, the U.S. Department of Commerce approved a $6.6 billion grant to TSMC’s U.S. division to support chip production in Phoenix, Arizona. “For the first time in history, the United States is manufacturing leading-edge four-nanometer chips on its own soil with American workers, matching Taiwan in both yield and quality,” Raimondo said in an interview, noting that production began in recent weeks.

“This achievement is unprecedented, and many doubted it could happen,” Raimondo added. While TSMC, the world’s largest contract chipmaker and a key supplier to Apple and Nvidia, has not commented on the development, the milestone underscores a major shift in semiconductor manufacturing.

In April, TSMC announced an expanded investment of $25 billion, raising its total commitment to $65 billion and adding a third Arizona fabrication facility (fab) by 2030. As part of the U.S. semiconductor subsidy program initiated by Congress in 2022, which allocated $52.7 billion for manufacturing and research, TSMC committed to using its most advanced chip-making technology, “A16,” in its Arizona facilities.

TSMC’s second Arizona fab is set to produce cutting-edge two-nanometer chips starting in 2028. Additionally, the Commerce Department has granted up to $5 billion in low-cost loans to support the company’s operations. Raimondo emphasized that this transformation was not automatic, noting the extensive efforts to persuade TSMC to expand its U.S. plans.

The first fab is expected to begin high-volume production by the first half of 2025. Raimondo’s goal is for the United States to manufacture 20% of the world’s leading-edge logic chips by 2030, up from essentially 0% before TSMC’s Arizona facility became operational.

In related developments, the Commerce Department also finalized a $407 million grant last month to Amkor Technology for its $2 billion semiconductor packaging facility in Arizona. Once fully operational, the plant will package and test chips for industries like autonomous vehicles, 5G/6G, and data centers, with Apple as its primary customer, leveraging chips produced at the nearby TSMC facility.

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Article Summary:

1. Milestone in U.S. Semiconductor Manufacturing: TSMC has begun producing four-nanometer chips in Arizona, marking the first time such advanced technology has been manufactured on American soil.
2. Major Investments and Expansions: TSMC has increased its U.S. investment to $65 billion, with plans to build a third fab in Arizona and produce two-nanometer chips by 2028.
3. Government Support: The U.S. Commerce Department provided $6.6 billion in grants and $5 billion in low-cost loans, part of a $52.7 billion semiconductor subsidy program to attract top chipmakers.
4. Broader Industry Impact: The U.S. semiconductor ecosystem is expanding, with additional facilities like Amkor Technology’s $2 billion packaging plant, set to support advanced industries and strengthen supply chains.