In the past, the President of the United States, Donald Trump, has accused Taiwan of stealing his country’s chip industry, but Taiwan’s largest microcircuits company is confident that Mr. Trump’s administration will continue funding its projects in the US.
As part of the Chips and Science Act, an initiative implemented by the administration of former United States President Joe Biden, Taiwan Semiconductor Manufacturing Co (TSMC) has been promised $6.6 billion. The corresponding financing is intended for the construction of three advanced chip fabrication plants in Arizona. In this case, Washington implemented one of its efforts aimed at developing onshore microcircuits manufacturing.
TSMC chief financial officer Wendell Huang, while talking to media representatives, said that under Donald Trump, financing is expected to continue to increase gradually as the fabrication plants undergo milestones of construction and production. He noted that the company had already received the first batch of government support in the fourth quarter of 2024. It was also clarified that the contract chip manufacturer had got $1.5 billion in funds.
Wendell Huang stated that after some production delays, the first fabrication plant in Arizona began manufacturing advanced microcircuits in the fourth quarter of 2024. He also noted that the construction of two other production sites in the mentioned region was on track. According to him, the commissioning of the second fabrication plant in Arizona is expected in 2028.
TSMC’s first investments in the mentioned region were announced in 2020. The company’s total investments in three projects in Arizona eventually exceeded $65 billion. Much of the financial injections were committed after the Joe Biden administration signed the bipartisan Chips Act in 2022. Washington planned earmarking of almost $53 billion in investments in domestic semiconductor supply chain and counter to China.
It is expected that Donald Trump will make competition with Beijing and onshoring production one of the priorities of his activities. At the same time, it is not yet known whether the Mr. Trump administration and the Republican-led House of Representatives will re-examine the Chips Act.
During his election campaign, Donald Trump criticized the mentioned bill and its price tag. In this context, he noted that tariffs are a more effective strategy for onshore chip production. Donald Trump also accused Taiwan of stealing the US chip business.
Industry experts, when talking to media representatives, mostly state that they expect Mr. Trump to basically maintain the development strategy of the United States area of chips in its current configuration. According to them, the corresponding probability is high due to bipartisan support for the Chips Act.
This month, TSMC reported a record profit in the fourth quarter of 2024. During the mentioned period, the corresponding indicator increased by 57% year-on-year. The corresponding result was achieved largely due to the high level of consumer demand for artificial intelligence chips. Against the background of record profit, the value of the company’s shares rose by almost 4%. In 2024, this figure increased by 81%.
TSMC chief executive officer and chairman C.C. Wei drew attention to the company’s long-standing and good relationship with the United States government. He also mentioned the commitment and support that the firm receives at the federal, state, and city levels.
It is worth noting that the semiconductor industry is gradually becoming what can be called a space of geopolitical rivalry. This is because chips are the main basic material element of new-generation technologies. Microcircuits are used in products of multiple categories. Currently, chips, for example, are needed for smartphones and cars. Microcircuits are also used to train and ensure the process of subsequent functioning of artificial intelligence systems. AI is the most advanced and most promising technology of modernity.
Currently, the ability to independently produce chips determines the economic potential of countries and their national security.
Moreover, the seeking of some states for technological sovereignty has recently intensified. The experience of the coronavirus pandemic, where global supply chains were disrupted, became a kind of historical reality that highlighted the importance of autonomous manufacturing. Also, the significance of technological sovereignty is increasing against the background of growing geopolitical tensions. The continuation and scaling up of the corresponding negative state of affairs may disrupt and in some cases stop the cooperation of world capitals, including in the manufacturing sector and the trade area. It is worth noting that the first examples of such a geopolitical order of things have already become facts of objective reality. For example, the United States has restricted the export of advanced chips and equipment for the production of microcircuits of the corresponding category to China. As part of the retaliatory measures, the Asian country has banned the shipments of certain minerals to the US. The lack of technological sovereignty makes the countries’ prospects for material and digital development vulnerable to the conditions and circumstances of the external global situation, which is not characterized by stability and is generally not a favorable environment within the framework of geopolitical turbulence, which so far shows no signs of improvement of the state of affairs.
TSMC is one of the beneficiaries of the development of advanced technologies, including artificial intelligence. The corresponding process is highly likely to continue and scale. This means positive prospects for TSMC.
