President Joe Biden’s administration has finalized a $6.6 billion award to Taiwan Semiconductor Manufacturing Company (TSMC) for new chip plants in Arizona, solidifying the CHIPS Act’s goals before President-elect Donald Trump takes office. The deal supports TSMC’s $65 billion investment in three semiconductor fabrication plants, expected to boost U.S. semiconductor production and create thousands of jobs.
The timing is significant, as Trump has criticized subsidies for foreign companies like TSMC, accusing Taiwan of overtaking the U.S. chip industry. In contrast, Biden framed the deal as a pivotal step in reducing dependence on foreign-made advanced chips, calling it “a new era for American manufacturing.” The first plant is scheduled to begin operations within months, producing leading-edge chips for companies such as Apple, NVIDIA, and Qualcomm.
The CHIPS and Science Act, a cornerstone of Biden’s economic strategy, allocates $52.7 billion for U.S. semiconductor research and manufacturing. Despite initial Republican resistance to the Act, opposition has waned due to the potential job losses in key districts. TSMC’s Arizona facilities are seen as critical to restoring America’s share in global semiconductor production, which has fallen from 40% to just 10%.
The deal also underscores geopolitical considerations, with Taiwan’s economy minister refuting Trump’s claims of exploiting the U.S. industry. TSMC’s role as a supplier for U.S. tech giants highlights the interconnected nature of global chip manufacturing. With this agreement secured, Biden’s administration ensures the CHIPS Act remains a foundational element of U.S. semiconductor policy, despite political shifts.
