TSMC Chipmaker Raises $3.5 Billion To Build New U.S. Plant
On April 20th, 2022 Taiwan Semiconductor Manufacturing Company (TSMC) announced that they have recently raised $3.5 billion in bonds to grow their facility in Arizona. The company’s plant is still under construction to meet the world’s high and growing demand for electronics. TSMC is a major supplier for Apple Inc, AMD, Nvidia, and other high profile electronics and computer companies.
Back in June of 2021, TSMC began construction for their Arizona plant and was estimated to cost around $12 billion to build. During the company’s annual technology presentation, CEO C.C. Wei explained that the factory is on schedule for chip production by 2024.
Less than two years from now, the company’s 5-nanometer chips will be available for their largest clients. These next generation chips are claimed to be 15% faster and require 30% less power when operating at full capacity.
TSMC along with Intel and Samsung are all competing for $52 billion in subsidies that are set aside for the chip industry. In early March of 2022, Biden urged Congress to pass the CHIPS Act that would advance semiconductor manufacturing in the U.S. and hopefully address the supply chain issues that are still rampant throughout the world.
More investment in the space continues to be a high priority for semiconductor manufacturers. It was reported in May of 2021 that TSMC would eventually build six factories within Arizona over a ten to fifteen year timespan. Access to subsidies would provide the necessary capital to keep TSMC on schedule for their longer term plans.
Wei also stated last year that TSMC would be investing $100 billion into factories as well as research and development over a three year period. An estimated $30 billion was already spent over the previous year. “That will give us enough manufacturing capacity to support the growth of our clients,” Wei said.
TSMC and the board are still concerned about chip-manufacturing costs outside of Taiwan. Founder of TSMC Morris Chang states that costs for manufacturing in their Oregon plant are still 50% higher than they are in Taiwan. Government subsidies and facilities built in other states like Arizona are in heavy demand with the aim of making U.S. manufacturing viable.