US State To Get Billions In Foreign Investment For New Chip Factory: REPORT

The world’s largest chipmaker plans to construct a second multibillion dollar factory in Arizona, The Wall Street Journal reported Wednesday.

Taiwan Semiconductor Manufacturing Co. (TSMC) had previously announced a $12 billion investment in Arizona in 2020, and sources familiar with the matter expected the new investment to be on the same scale, the WSJ reported. The proposed factory, located north of Phoenix, would produce 3-nanometer transistors, cutting-edge chips that are among the smallest and fastest ever made. (RELATED: Nvidia Resumes Sales Of High-Performance Chips To China)

While the company confirmed plans to construct a second building at its Arizona site, the facility may not necessarily become a second chip factory, TSMC told the Daily Caller News Foundation.

This building enables us to remain flexible for future expansion, but we have not arrived on a final decision on a second fab,” TSMC said in a statement to the DCNF. “In light of the strong customer demand we are seeing in TSMC’s advanced technology, we will consider adding more capacity in Arizona with a second fab based on operating efficiency and cost economic considerations.”

TSMC is expected to begin mass production of 5- and 4-nanometer transistors in 2024 at the facility announced in 2020, according to the WSJ.

U.S.-based semiconductor manufacturing facilities are expected to begin receiving tax breaks and roughly $39 billion in grants in 2023, in a bid by the U.S. government to secure access to products considered vital to national security, the WSJ reported. In particular, the CHIPS Act has encouraged foreign firms to bring their manufacturing to the U.S., according to Reuters.

Manufacturers in the electric vehicle and battery industries have collectively invested billions of dollars in U.S.-based manufacturing, taking advantage of tax breaks provided by the Inflation Reduction Act.

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