Taiwan Semiconductor Manufacturing Company (TMSC) is the first CHIPS Act recipient to receive a portion of the government’s promised funding. The Biden administration has finalized subsidies for TSMC, which will receive $6.6 billion in subsidies as part of an agreement to expand semiconductor production in the United States. TSMC will also receive an additional $5 billion in government financing to fund the expansion of its planned $65 billion three-factory complex in Arizona. According to Bloomberg, it is expected to receive at least $1 billion of the total by the end of the year, as it has already met certain requirements.
In October, a Canadian research firm discovered that Huawei was using TSMC chips in its artificial intelligence accelerators, despite violating U.S. government sanctions. TSMC denies any cooperation with Huawei and has halted shipments of its chips to customers who may have been illegally sending them to Huawei. It also reportedly decided to halt production of advanced AI chips for Chinese customers because it wanted to show the U.S. government that it was “not acting against U.S. interests.”
“Today’s final agreement with TSMC, the world’s leading manufacturer of advanced semiconductors, will spur $65 billion in private investment, build three state-of-the-art facilities in Arizona, and create tens of thousands of jobs by the end of the decade. …The first of TSMC’s three facilities is scheduled to fully open early next year,” President Joe Biden said in a statement.
Other companies such as Intel and Samsung are still waiting to receive subsidies. Business groups are reportedly urging the government to finalize a deal with the CHIPS Act before Biden leaves office. They are not worried about the new administration repealing the CHIPS Act, which had bipartisan support, but they do want to avoid the possibility of having to renegotiate it with the government.
