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TSMC Unveils Major U.S. Fab Expansion Plans

TSMC this week celebrated the opening of its first U.S. fab in a “groundbreaking” ceremony. During the event, the company unveiled plans to invest billions of dollars in the expansion of its Fab 21 near Phoenix, Arizona. The world’s leading foundry will start producing chips with its N3 process technology in 2026.

Phase 1 of TSMC’s Arizona fab was completed earlier this year, and installation of production tooling from companies such as ASML, Applied Materials, KLA, Lam Research and Tokyo Electroni has now begun. The plant is expected to be operational in early 2024. It will produce chips with a variety of process technologies.

TSMC Arizona – December

Companies such as AMD, Apple and NVIDIA are set to place orders through Fab 21 Phase 1 to produce their advanced chips in the U.S. for the first time in years.

But that’s not all TSMC has in store for Fab 21. The company has announced its intention to build a second factory on the same site, further expanding its U.S. production capacity and establishing an even newer production line.

The new Arizona factory will expand TSMC’s capacity to about 50,000 WSPM and bring TSMC’s total investment in the plant to $40 billion. This is an increase of $28 billion over TSMC’s initial $12 billion investment in its first Arizona factory, highlighting that the costs of new factories continue to rise, but also that TSMC is increasingly comfortable making large infrastructure investments in the United States. According to a Reuters report, TSMC expects annual revenue from the Arizona factories to be around $10 billion. Meanwhile, TSMC customers using the factories will generate about $40 billion in revenue from the sale of products made by the foundry in the United States.