TSMC plans another fab in Phoenix, Arizona for manufacturing 3nm chips

The Taiwan Semiconductor Manufacturing Company (TSMC) is planning for another semiconductor manufacturing facility north of Phoenix, Arizona. The fabrication plant will be able to manufacture 3nm transistors.

The new plant is said to be the expansion of Fab 21, a plant that TSMC has under the works in Arizona. Fab 21 is expected to start manufacturing of 5nm chips from early 2024.

The news comes after Washington tried to lure chip manufacturers into the country by providing them with lucrative grants. Many countries in Europe are also pushing domestic chip manufacturing after the chip supply shortage that started in 2021 revealed the bottleneck situation of the supply chain industry.

The shortage was also fueled by the high demand of consumer electronics during the pandemic, as more people shifted their classrooms and workplaces at home. Along with the lockdown of factories and ports, the supply shortage spiraled down to the worst.

TSMC invested around $12 billion for constructing its Fab 21 facility. The investment for the expansion is said to be around the same. Chip executives believe that the global sales for semiconductors will double in the next decade to over $1 trillion a year, which underpins the huge upfront investment.

The United States allocated about $39 billion as part of its grants for domestic semiconductor manufacturing. The grants will be given out starting next year, in addition to tax breaks on semiconductor manufacturing equipments and more.

TSMC had also announced its investment of around $40 billion to build four new fabrication lines in Taiwan, while also considering to expand fab facilities in Japan and Singapore.

Source: The Wall Street Journal

TSMC plans another fab in Phoenix, Arizona for manufacturing 3nm chips