HomeLatest FeedsTechnology NewsSecond TSMC Arizona chip plant delayed; may be less advanced

Second TSMC Arizona chip plant delayed; may be less advanced

The second TSMC Arizona chip plant has been delayed, just like the first one. The company had previously said that the plant would come online in 2026, but now says this has been pushed back to 2027 or 2028.

Additionally, the chipmaker says that the second plant – initially set to be making advanced 3nm chips – may also be downgraded to larger-process chips …

TSMC Arizona chip plants

It was in 2020 that TSMC first announced its plans to build one or more chip plants in Arizona. It was claimed that 1,600 US jobs would be created, including those in a local supply chain.

The company sought substantial subsidies from the US government in order to proceed. Apple supported this bid, lobbying on TSMC’s behalf through the CHIPS Act, a $50B program to promote chip fabrication within the US

The first plant was due to begin production in 2024, but construction fell behind schedule, with reports of serious safety issues at the plant, that were only partly denied by TSMC.

Controversially, the chipmaker opted to bring in hundreds of workers from Taiwan to speed up the work – resulting in conflicts with US workers – and a new start date of 2025.

Second plant now also delayed

Bloomberg reports that the operational date of the second plant has also been pushed back, perhaps even by two years.

Taiwan Semiconductor Manufacturing Co. announced another delay to its $40 billion site in Arizona […] Executives said their second plant, whose shell is now being built, will start operations in 2027 or 2028, later than TSMC’s prior guidance of 2026.

May also lose 3nm chipmaking capabilities

Originally, TSMC said that the first plant would make 4nm chips, while the second would make more advanced 3nm chips. The company now says this may change.

Previously, TSMC said it will make 3nm chips at the second factory, which is expected to be more advanced than the first in Arizona. But on Thursday, the company said that incentives from the US government will help determine how advanced the tech inside will be, adding uncertainty to the project’s outcome […]

“Our overseas decisions are based on customer needs and the necessary level of government subsidy, or support,” Chairman Mark Liu said during TSMC’s earnings conference in Taipei on Thursday.

That’s a reference to the fact that the White House hasn’t yet provided any of the promised funding through the CHIPS Act.

Could be a double blow

A delay of up to two years, coupled to a downgrading of the capabilities, could leave the second plant around five years behind Taiwan in its chip processes.

TSMC had always planned to reserve its most advanced processes for fabs within its home country, but limiting production to 4nm at a time when its Taiwanese plants may have moved on to a 1.4nm process would mean the plant would be unlikely to be in a position to make chips even for the oldest Apple products still on sale at that time.

Photo by Adam Davis on Unsplash

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