TSMC celebrates success in Arizona: production a chip-length ahead

Taiwan Semiconductor Manufacturing Co. (TSMC) has achieved impressive production yields at its first factory in Arizona, surpassing the rates of similar facilities in Taiwan. This remarkable progress marks an important step in the company's U.S. expansion project, which had initially been plagued by delays and workforce issues. According to Rick Cassidy, president of TSMC's U.S. division, the facilities in Phoenix are producing about four percentage points more usable chips than comparable factories in Taiwan. This production performance is crucial as it determines a company's ability to cover the enormous costs of a chip plant. TSMC's success underscores Washington's efforts to strengthen domestic semiconductor production. TSMC, the main production partner for Nvidia and Apple, anticipates government support amounting to $6.6 billion in grants and $5 billion in loans, as well as 25% tax incentives for the construction of three factories in Arizona. However, this funding under the Chips and Science Act of 2022 is not yet fully secured. Although a TSMC spokesperson did not directly comment on Rick Cassidy's event, CEO C.C. Wei recently told investors that the first factory began producing 4-nanometer wafers in April and the results were extremely satisfactory. This was a significant operational milestone for TSMC and its customers. In contrast, other key players in the Biden administration's technology strategy, such as Intel and Samsung, are struggling with issues. Intel, which is largely expected to benefit from the Chips Act, is facing severe financial burdens and is delaying projects worldwide. TSMC, on the other hand, is experiencing a surge. The company's stocks reached a record high this month after surpassing quarterly estimates and raising its growth forecast for 2024. The progress in Arizona is particularly surprising, as TSMC traditionally houses its most advanced facilities in Taiwan. The initial challenges in Arizona, such as the lack of skilled personnel and safety issues, were overcome through an agreement with construction unions at the end of last year.