TSMC Struggles with Arizona Chip Production Challenges

Taiwan Semiconductor Manufacturing Co. (TSMC) is facing significant delays in establishing advanced chip production at its new Arizona facility due to complex compliance issues, stringent local regulations, and extensive permitting requirements, according to CEO C.C. Wei. The timeline for building the Arizona plant has been approximately twice as long as similar projects in Taiwan, leading to concerns that the U.S. facility will not adopt TSMC’s latest chip technology ahead of its Taiwanese counterparts. Despite a substantial investment of $65 billion to build three factories, TSMC plans to retain its most advanced chip production in Taiwan, primarily for reasons of cost and technological lead. The U.S. government has supported this initiative through grants and incentives aimed at bolstering domestic semiconductor manufacturing. While the Arizona plant has commenced production of 4-nanometer chips, these are more expensive than similar products made in Taiwan due to higher operational costs and a less developed local ecosystem. Wei remains optimistic about the facility's future output quality but acknowledges that operational efficiency in Arizona is still lagging behind Taiwan's standards.