[News] TSMC’s U.S. Board Meeting Focus at a Glance: Potential Expansion Amid Chip Export Restrictions

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TSMC will hold its first board meeting in the U.S. on February 11, 2025, where it plans to announce senior management updates. Notably, markets are watching whether the foundry giant will announce new U.S. investments, especially with Trump pushing for advanced chips to be made in the U.S. and hinting at tariffs.

Additional Investment in Arizona Likely on the Way

According to the Economic Daily News and Commercial Times, at the event, TSMC is expected to confirm plans for mass production at its third Arizona fab, possibly launch a fourth fab, or even build its first advanced packaging plant. The fourth fab is anticipated to focus on 1.6nm production, as noted by the Economic Daily News report.

Designed at twice the size of typical fabs, TSMC’s Arizona Mega Fab has reportedly space for P4-P6, in addition to Fab 21 P1-P3. According to TSMC and media reports, the company’s $65 billion investment in Arizona includes Fab 1 (4nm, in production), Fab 2 (planned for 2028), and Fab 3 (targeting 2nm or A16 angstrom, planned for 2030), with possible acceleration for Fab 2 and 3.

Strategic Move to Trump’s Tariff Proposal

Notably, according to TSMC’s earnings report, the North American market accounted for 75% of its total revenue in the fourth quarter of 2024. Thus, Trump’s chip tariffs would hit many of TSMC’s major clients in the U.S. like Apple, NVIDIA, AMD, Broadcom, Qualcomm, and even Intel, as highlighted in the Economic Daily News report.

The report suggests that while Trump’s tariff threats may be mostly rhetoric, his real aim is to push TSMC to produce more advanced chips in the U.S. At this rate, sub-2nm production in the U.S. seems inevitable.

The Commercial Times report suggests TSMC’s global 2nm capacity would be roughly 170K wafers per month—140K in Taiwan and 30K in Arizona. Meanwhile, according to the report, its capacity for 1.4nm and 1nm is expected to reach 150K and 130K per month in Taiwan, respectively, which would be able to cover global demand. This makes TSMC’s U.S. expansion more strategic than essential, the report adds.

“Extremely Cautious” on 14/16nm Chip Shipments

On the other hand, in terms of Biden’s last-minute chip ban, which targets processors with 30 billion transistors at 16/14nm or smaller nodes, TSMC is said to be taking an “extremely cautious” approach, according to Nikkei.

Under this scenario, TSMC reportedly notified many Chinese IC firms it would halt shipments of 16/14nm and below products from January 31, 2025, unless they use an approved OSAT by Bureau of Industry of U.S. and Security and provide certification.

According to a MoneyDJ report citing Nikkei, TSMC, after consulting with legal advisors and the U.S. Commerce Department, will not ship to any customer using Chinese packaging plants, even if the supplier is on the U.S. whitelist. This strict policy severely affects Chinese chip developers without U.S.-approved packaging, impacting industries from smartphones to autonomous driving, the report notes.

Read more

• [News] TSMC Reportedly Halts 14/16nm Chip Shipments to Chinese IC Firms unless Packaged by Approved OSATs
• [News] NVIDIA Reportedly in Talks with TSMC to Produce Blackwell in Arizona, While Packaging Handled in Taiwan

(Photo credit: TSMC)