U.S. Secretary of Commerce Gina Raimondo testifies during the House Science, Space and Technology Committee hearing titled “Chips on the Table: A one year review of the CHIPS and Science Act,” in the Rayburn Building in Washington, D.C., on Sept. 19, 2023.
Tom Williams | Cq-roll Call, Inc. | Getty Images
TSMC‘s Arizona subsidiary is set to receive up to $6.6 billion in U.S. government funding under a preliminary agreement announced by the Biden administration on Monday.
The funding, under the U.S. CHIPS and Science Act, will support Taiwan Semiconductor Manufacturing Co.’s more than $65 billion investment in three cutting-edge fabrication plants in Phoenix, according to the nonbinding agreement.
The Taiwanese multinational semiconductor company is also eligible for around $5 billion in proposed loans under the CHIPS Act.
U.S. Secretary of Commerce Gina Raimondo said at a press briefing that the agreement was “huge,” adding that the partnership with TSMC will bring “the manufacturing of the world’s most advanced chips to American soil.”
According to Raimondo, the funds will include $50 million to train and develop local talent in Arizona, with TSMC Arizona having already created more than 25,000 jobs and attracted 14 semiconductor suppliers for the state.
The CHIPS Act, passed in August 2022, is an almost $53 billion package aimed at building the U.S. domestic semiconductor industry to boost the country’s economy and better compete with rivals such as China for national security purposes.
The legislation provides billions in incentives for companies to produce chips in the U.S., on the condition that they do not expand certain semiconductor manufacturing operations in China and other countries deemed a national security risk.
On Monday, Raimondo lauded TSMC’s move in Arizona, the largest such foreign investment in the state’s history, as evidence of strong chip leadership from the Biden administration and the U.S. Congress.
TSMC is the global leader in semiconductor fabrication and makes the vast majority of the world’s leading-edge logic chips, used in emerging technologies such as artificial intelligence. It’s Arizona factories are expected to provide chips to customers including Apple and Advanced Micro Devices.
Other companies that have received funding under the CHIPS Act include GlobalFoundries, Microchip and BAE Systems, as well as Intel, which was awarded up to $8.5 billion in indirect funding and up to $11 billion in loans last month.