Image Source: Taiwan Semiconductor Manufacturing Co., Ltd.

In line with earlier reports of possible chip manufacturing factories from Intel and TSMC in the US, Taiwan’s TSMC has made an official announcement for the same. The world’s largest contract semiconductor foundry will build this new $12Bn plan in Arizona US, with “commitment” to support from the U.S. federal government and the State of Arizona.

The new plant, which is expected to be operational by 2024, will utilize TSMC’s most advanced 5-nanometer technology for semiconductor wafer fabrication, have a 20,000 semiconductor wafer per month capacity, create over 1,600 high-tech professional jobs directly, and thousands of indirect jobs in the semiconductor ecosystem.

Construction is planned to start in 2021 with production targeted to begin in 2024. TSMC’s total spending on this project, including capital expenditure, will be approximately US$12 billion from 2021 to 2029.

In a statement released early morning today, TSMC said, “This U.S. facility not only enables us to better support our customers and partners, it also gives us more opportunities to attract global talents.” The chip facility would help US tech giants to not only domestically design, but produce chips as well. “This project is of critical, strategic importance to a vibrant and competitive U.S. semiconductor ecosystem that enables leading U.S. companies to fabricate their cutting-edge semiconductor products within the United States and benefit from the proximity of a world-class semiconductor foundry and ecosystem.”, added TSMC.

The US has been talking to TSMC for a long time now, for the company to come up with a chip manufacturing facility in the US. One of the biggest hurdles for TSMC has been the high cost of building and operating a large scale foundry in the US, as compared to Taiwan. However with a “commitment” of support from the US federal government, it seems that has now been taken care of.

The chip factory will be a result of an ever intense trade war between the two largest economies on Earth — the US and China. US President Donald Trump has been quite public about his dissentment from the over dependence of US companies on China for their manufacturing needs. One of the biggest outsourced industries in production has been advanced electronics manufacturing.