The US Department of Commerce revealed plans to award Taiwan Semiconductor Manufacturing Co (TSMC) $6.6 billion in direct funding and up to $5 billion in government loans to build a third chip production facility in the state of Arizona.

The additional proposed funding under the CHIPS and Science Act increases TSMC’s planned investment by $25 billion to $65 billion as the administration of US President Joe Biden seeks to reduce reliance on chip imports from countries such as China.

President Biden stated TSMC will create more than 25,000 direct construction and manufacturing jobs while TSMC expects Arizona’s three fabs to create approximately 6,000 high-tech jobs.

“These facilities will manufacture the most advanced chips in the world, putting us on track to produce 20 per cent of the world’s leading-edge semiconductors by 2030,” Biden stated.  

The third Arizona fab is slated for production of chips using 2nm or more by 2030. Arizona’s first fab is on track to start production using 4nm technology in the first half of 2025 after initially targeting this year. The second fab will use 2nm process technology with production slated to begin in 2028.

“The leading-edge semiconductors that will be made here in Arizona are foundational to the technology that will define global economic and national security in the 21st-Century, including AI and high-performance computing,” stated US Secretary of Commerce Gina Raimondo.