The world's leading producer of advanced computer chips, Taiwan Semiconductor Manufacturing Company, announced an expanded $40 billion investment in its US production hub in Phoenix.
President Joe Biden visited the manufacturer's site in Phoenix and spoke about bringing jobs and investment to Arizona, calling TSMC's commitment "the largest foreign investment in the history of this state."
"American manufacturing is back, folks," Biden said at the event. "These are the most advanced semiconductor chips on the planet, chips that will power iPhones and MacBooks ... It could be a game changer."
Why it's a big deal: TSMC produces an estimated 90% of the world's super-advanced chips — indispensable components for pretty much every device you interact with day to day, like your car and your smartphone, along with a bunch that you most likely don't, like military drones and missiles.
Some of TSMC's biggest clients include Apple, Qualcomm and Amazon.
It was already building one factory, set to open late next year, but the expanded investment will add a second facility that TSMC hopes will be online in 2026.
Why the big push in Phoenix?
The White House is touting the new investments as a direct result of the CHIPS bill, which Biden signed this summer. That measure invests more than $200 billion to encourage companies to bring chip production back onto American soil.
The motivation to shift production closer to home gained force on both sides of the aisle early in the pandemic.
Remember those long wait times for new cars, or crazy high prices for used cars? That was primarily because of a chip shortage, sparked by sudden global demand for gadgets to facilitate remote work and school.
The goal is to make sure US supplies are secure in the event of another catastrophe, while also helping to foster a resurgence of American manufacturing.
Of course, it won't be easy.
TSMC is already hitting snags in its Phoenix operation, according to the Wall Street Journal.Among them are relatively higher costs to build in the United States and a shortage of sufficiently trained personnel.
But there's a political motivation also driving Taiwan-based TSMC to deepen ties with the United States. As tensions between Washington and Beijing escalate, the Biden administration has repeatedly underscored the US's commitment to defend the island in the event of a Chinese invasion.
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