TSMC Warns U.S. Tariffs Could Undermine Arizona Chip Projects

Taiwan Semiconductor Manufacturing Company (TSMC) has warned that proposed U.S. tariffs on foreign-made semiconductors could derail its $165 billion investment in advanced chip manufacturing in Arizona, PC Mag reported.

Its Arizona fabs, once complete, are expected to produce about 30% of TSMC’s global capacity for 2-nanometer and more advanced chips. I Photo: TSMC

In a letter to the U.S. Commerce Department, TSMC cautioned that tariffs would depress electronics demand, shrink company revenues, and jeopardize its Arizona timeline.

“Diminished demand could create uncertainty around the construction and operation of our Arizona fabs,” the company wrote.

“It could also undermine TSMC’s financial capacity to timely execute its ambitious Arizona project.”

TSMC—which supplies chips for Apple, AMD, Nvidia, and even Intel—stressed that tariffs would hurt not just its business, but also major U.S. customers. The company has committed over $100 billion to build three additional fabs in Arizona, for a total of six, but only one is currently operational.

The company is urging the Biden or Trump administration to exempt existing U.S. projects from any new trade restrictions.

Its Arizona fabs, once complete, are expected to produce about 30% of TSMC’s global capacity for 2-nanometer and more advanced chips—enough, the company said, to meet U.S. market demand.