President Trump has confirmed Taiwan Semiconductor Manufacturing Co (TSMC) will pour another $100 billion into new US chip plants.
The investment will fund the construction of five new advanced fabrication plants on American soil, which will create thousands of new jobs.
Trump framed the move as a win for US manufacturing, adding saying it shields TSMC from potential tariffs he has floated for the global semiconductor industry.
The President said his goal is to reduce reliance on foreign production and position the US as a dominant player in chip manufacturing.
Total US Investment Hits $165 Billion
Standing alongside Trump, Wei confirmed the expanded investment brings TSMC’s total US spending to $165 billion.
He said:
“We are producing the most advanced chip on US soil.
“Now the vision becomes reality.”
Trump praised Wei as a “legend,” adding that the plan will create thousands of new jobs and give the US a stronger foothold in the global semiconductor market.
US Seeks to Secure Semiconductor Supply
Semiconductors power everything from smartphones and cars to AI servers, and TSMC produces many of the world’s most advanced chips.
Taiwan currently dominates the sector, keeping much of its production within its borders under heavy security. Analysts often point to Taiwan’s chip dominance as its “silicon shield” against Chinese military aggression.
James Yifan Chen, assistant professor at Tamkang University in Taiwan, warned that shifting too much production out of Taiwan could weaken this strategic advantage.
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Trump Warns Against Chinese Aggression
At Monday’s event, Trump said any Chinese invasion of Taiwan would be “catastrophic.”
He argued TSMC’s US expansion will ensure America controls a significant share of the global semiconductor supply, even if Taiwan’s industry faces disruption.
Taiwan Government to Review the Deal
Taiwan’s premier, Cho Jung-tai, responded to the news by stressing the importance of government oversight when companies expand abroad.
He said:
“Keeping roots in Taiwan and continuing to strengthen Taiwan is the shared stance of the country, government, and industry, and it will remain unwavering.”
Taiwan’s investment review department said it will evaluate TSMC’s plans to ensure they don’t weaken the island’s semiconductor industry.
A spokesperson said the government can reject overseas investments if they lack proper documentation, though such cases are rare.
TSMC’s Growing US Footprint
TSMC first committed to US production in 2020, building its first facility in Arizona. That plant began operations late last year.
- In April 2023, TSMC increased its planned US spending by $25 billion to $65 billion.
- The company promised to build two additional plants in Arizona by 2030.
- TSMC will produce 2-nanometer technology at its second Arizona plant, starting in 2028.
- The company also plans to use its most advanced chip technology, known as “A16,” in its US facilities.
How Government Subsidies and Tariffs Shape the Deal
TSMC’s expansion is partly fueled by government support.
Under President Joe Biden, the US Commerce Department approved a $6.6 billion subsidy for TSMC’s Arizona operations in November 2024. TSMC also received $1.5 billion from the Chips Act before the current administration took office.
The Chips and Science Act, signed in 2022, offers $52.7 billion to boost US semiconductor production and research.
Despite the subsidies, Trump has repeatedly criticized the Chips Act. On the campaign trail, he argued tariffs would be a more effective way to bring foreign manufacturers to the US.
On Monday, Trump said TSMC’s decision to build in America exempts the company from future tariffs.
He also confirmed that reciprocal tariffs on Canada and Mexico will take effect on April 2.
He said:
“If companies in those countries want to avoid tariffs, they should build here.
“That’s what Mr Wei is doing. He’s way ahead of the game.”
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What’s Next for US Chip Manufacturing?
Howard Lutnick, US commerce secretary, praised Trump for attracting more semiconductor production to the US.
He said:
“Now you’re seeing the power of Donald Trump’s presidency.”
However, Lutnick has yet to approve some grants promised under the Chips Act, saying he wants to fully review them first.
TSMC’s deepening US presence reflects the growing importance of semiconductor self-sufficiency. With global supply chains under pressure and geopolitical tensions high, both the US and Taiwan face critical decisions about the future of chip manufacturing—and who controls it.
