TSMC may build several new fabs in Arizona as part of proposed US-Taiwan trade deal
The White House is reportedly nearing a trade deal with Taiwan that would call for Taiwan Semiconductor Manufacturing Co. to increase its U.S. investment and the number of fabs at its north Phoenix site, according to a Wall Street Journal report.
As part of the proposed trade deal, the U.S. would lower tariffs on goods exported from Taiwan from the current 20% rate to 15%, while Taiwan would pledge more than $300 billion in foreign direct investment in the U.S., the Wall Street Journal reported, citing people familiar with the matter.
Taiwan’s investment includes and expands upon TSMC’s previously announced $165 billion investment in its north Phoenix fab site that, when complete, will include six fabs, two advanced packaging facilities and a research and development center.
Under the new trade deal, TSMC may build “several new fabs” in Arizona, bringing the chip giant’s total footprint to nearly a dozen plants at its growing fab site, the Wall Street Journal reported. TSMC’s additional Arizona plants would produce logic chips used for artificial intelligence and advanced computing.
Just last week, TSMC paid $197 million at a public Arizona State Land Department auction for 900 acres of land adjacent to its north Phoenix fab site, which the Wall Street Journal reported may be used for the planned new facilities.
TSMC’s additional investment would likely approach or exceed $100 billion for the additional fabs. The timeline for TSMC’s investment is unclear, although the fabs would likely be complete in the 2030s, Bloomberg reported, citing a person familiar with the matter.
The U.S.-Taiwan trade agreement, which has been under negotiation for months, is being legally scrubbed and could be announced this month, according to the New York Times.
A TSMC spokesperson declined to comment on the proposed trade deal or whether the company will increase its Arizona fab site investment.
TSMC is in the process of building out its Arizona fab site, having completed its first fab that started high-volume production of N4 technology chips in late 2024.
The company also completed its second fab and plans to install chipmaking equipment in the facility during the third quarter, paving the way to begin 3-nanometer chip production by 2027, which is a year earlier than expected, the Business Journal previously reported.
TSMC broke ground on its third fab in mid-2025 and is slated to start N2 technology or more advanced by 2030, according to the company.