UPDATE - US to provide $6.6B funding for Taiwan's chipmaker

ADDS PRESIDENT JOE BIDEN'S COMMENTS, MORE DETAILS

By Ovunc Kutlu

ISTANBUL (AA) - The US Commerce Department announced Monday it will provide up to $6.6 billion direct funding for Taiwan Semiconductor Manufacturing Company (TSMC) under the CHIPS and Science Act.

The department said TSMC plans to build a third fab at its facility in the US state of Arizona to meet strong customer demand of advanced semiconductor process technology.

This funding will support TSMC's investment of more than $65 billion in three leading-edge fabs in Phoenix, Arizona to manufacture the world’s most advanced semiconductors, it said in a statement.

With the additional funding, TSMC Arizona will create approximately 6,000 direct manufacturing jobs and more than 20,000 accumulated construction jobs, it added.

"The CHIPS and Science Act provides TSMC the opportunity to make this unprecedented investment and to offer our foundry service of the most advanced manufacturing technologies in the United States," TSMC chairman Dr. Mark Liu said in a separate statement.

"Our U.S. operations allow us to better support our U.S. customers, which include several of the world’s leading technology companies. Our U.S. operations will also expand our capability to trailblaze future advancements in semiconductor technology."

TMSC said its first fab in Arizona is on track to begin production leveraging 4nm (nanometer) technology in first half of 2025, while the second fab will produce the world’s most advanced 2nm process technology, in addition to the previously announced 3nm technology, beginning in 2028.

The third fab will manufacture chips using 2nm or more advanced processes with production beginning by the end of this decade.

The recent agreement is the second grant the US has made in the past three weeks after President Joe Biden announced in March his administration will provide $8.5 billion funding for Intel through the CHIPS and Science Act for the American chipmaker to fund its facilities in the states of Ohio, Arizona, New Mexico and Oregon.

Biden said in a statement on Monday that TSMC’s renewed commitment to the US and its investment in Arizona represent "a broader story for semiconductor manufacturing that's made in America."

"Semiconductors – those tiny chips smaller than the tip of your finger – power everything from smartphones to cars to satellites and weapons systems. America invented these chips, but over time, we went from producing nearly 40% of the world’s capacity to close to 10%, and none of the most advanced chips, exposing us to significant economic and national security vulnerabilities," he said.

The CHIPS and Science Act was signed into law by Biden in August 2022. It sets aside $52.7 billion to increase production of US-made semiconductors, address supply chain vulnerabilities by producing more goods in the US, and bolster domestic scientific research.