TSMC, the world’s largest contract chip maker, announced in May 2020 that it would build a $ 12 billion plant in Arizona.

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Taiwan Semiconductor Manufacturing Co Ltd (TSMC) plans to build several more chip manufacturing plants in the U.S. state of Arizona beyond the one currently planned, three people familiar with the matter told Reuters.

TSMC, the world’s largest contract chipmaker, announced in May 2020 that it would build a $ 12 billion plant in Arizona, an apparent victory for the Trump administration in its efforts to fight drug chains. global technology supply from China.

TSMC is in the process of setting up a 12-inch wafer manufacturing plant in Phoenix, and the facility is expected to start volume production in 2024, the Ministry of Economic Affairs Taiwan Investment Commission said in December, who approved the investment.

TSMC manufactures the majority of its chips in Taiwan and has older chip facilities in China and the US state of Washington.

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Three sources familiar with the matter, speaking on condition of anonymity because they were not authorized to speak to the media, told Reuters that up to five additional plants for Arizona were planned.

Initial manufacturing is relatively modest by industry standards, with an expected production of 20,000 wafers – each of which contains thousands of chips – each month using the most sophisticated 5-nanometer semiconductor manufacturing technology. of the society.

It is not known how much additional production and investment capacity the additional factories could represent, or what chip manufacturing technology they would use.

TSMC announced last month that it intends to invest $ 100 billion over the next three years to increase its production capacity, without giving details.

A person with direct knowledge of the matter told Reuters the expansion was in response to a request from the United States, but declined to provide further details.

“The United States has requested it. Internally, TSMC plans to build up to six factories,” the person said, adding that it was not possible to give a deadline.

The Biden administration is preparing to spend tens of billions of dollars to support domestic chipmaking. Under existing legislation, foreign companies are eligible for these funds, but whether they will ultimately receive them is an open question.

A second person familiar with the plans said the company had already made sure there was enough space for expansion when it secured the land for the first factory.

“It’s so that they can build six fabs,” the source said.

The third person, from a TSMC supplier involved in the project in Arizona, said TSMC told them their plan was to build a total of six factories over the next three years.

Reuters was unable to independently confirm the deadline.

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TSMC referred to CEO CC Wei’s comments on a earnings call last month, saying the company is starting chip production in Arizona in 2024 with 20,000 wafer per month technology at 5 nanometers.

“But in fact, we acquired a large piece of land in Arizona to provide flexibility. So further expansion is possible, but we will move on to phase 1 first and then based on operating efficiency and cost savings, as well as customer demand, to decide on the next steps. that we are going to do. “

When asked if the planned expansion was due to a demand from the United States, TSMC said it was “not sure” what “requests” from the US side meant and would decide. next steps based on operational efficiency, cost savings and customer demand.

“Once there is an official ruling, we will release it accordingly.”