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As part of the the recently concluded trade arrangement between the U.S. and Taiwan, Taiwanese companies, including TSMC, will invest $250 billion in the U.S. in exchange for exemptions from potential chip tariffs, Financial Times reports. However, limited disclosure around the terms of this commitment has introduced major uncertainties regarding TSMC's future capital spending, manufacturing allocation, and long-term strategy. Meanwhile, a market rumor suggests that TSMC may invest an additional $100 billion in its U.S. facilities, bringing its total investment commitments to $265 billion and making the company one of the biggest ever investors in America.
The $250 billion figure largely reflects previously announced plans, and TSMC is projected to be the biggest spender. The company has already committed $165 billion to its Fab 21 campus in Arizona, which includes six fab modules, two advanced packaging facilities, and a research and development center. According to U.S. commerce secretary Howard Lutnick, roughly $100 billion of TSMC’s existing commitments are included in the investment total. TSMC's supply chain partners are projected to contribute about $30 billion. According to market rumors, TSMC may invest an additional $100 billion to construct four more fab modules in Arizona in a bid to avoid tariffs. TSMC's recent acquisition of approximately 900 acres of land adjacent to its existing 1,100-acre site supports the possibility of expansion on that scale.
Other Taiwanese companies, including Foxconn, are expanding U.S. capacity to assemble AI servers, though these projects are considerably less capital-intensive and are expected to total no more than $20 billion, according to Financial Times .
U.S. government plans tariff exemptions for TSMC, if it follows through on American investment
U.S. slashes Taiwan tariffs in new semiconductor trade deal
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/semiconductors/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/semiconductors/tsmc-considers-an-additional-usd100-billion-investment-into-arizona-fabs-to-bolster-american-chipmaking-efforts-move-would-help-tsmcs-chips-avoid-tariffs-due-to-local-production#main
- https://www.tomshardware.com
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Informational only. No financial advice. Do your own research.