TSMC postpones production at its Arizona plant to 2025

TSMC is delaying production at its Arizona plant to 2025. Apple may suffer severe repercussions as a result of this.

TSMC will eventually not produce chips from Arizona according to the initial schedule. The Phoenix factory of the Taiwanese business will now begin producing 4 nm chips in 2025 rather than 2024. There are not enough skilled workers to meet the deadlines, according to President Mark Liu. The company plans to hire technicians from their country to help finalize the project.

TSMC postpones production at its Arizona plant to 2025

The Arizona complex is one of the biggest examples of the CHIPS and Science Act that President Biden implemented last year. This measure aims to increase semiconductor production in the United States and includes a budget of $52.7 billion in subsidies and other tax exemptions for companies that build plants in the country. TSMC is targeting $15 billion in tax-exempt funding for its two plants in Arizona, while investing, normally, about $40 billion in these projects.

The federal government does not seem to be concerned about this shortage of workers. In a statement, White House representative Olivia Dalton said that the CHIPS and Science Act will provide “the necessary labour”.

A delay that could have serious consequences for Apple

Still, this delay poses a problem for companies that depend on TSMC production, including Apple. Future iPhone and Mac will use 4 and 3 nm chips made in Phoenix factories. If this deadline is proven, Apple will either have to postpone the launch of these products or call on other suppliers. Intel is injecting $20 billion into two factories in Arizona to start production in 2024, but these components won’t necessarily be available for Apple.

In any case, this delay reflects one of the main challenges in attracting tech manufacturers to the United States. Although there is no shortage of money across the Atlantic, there are far fewer skilled workers for this type of mission than in Taiwan or other specialized regions. Foxconn would have no trouble finding such workers in China, for example, but they are much rarer in the United States. Factories like the Mac Pro in Austin focus on niche products that don’t need as many employees.

That being said, there is a lot of pressure for the TSMC plants to operate. This should not only boost the American economy, obviously, but also allow the country to be less dependent on China on this aspect. This could also help solve the problem of working conditions and reduce worries if relations between the US and China deteriorate. Many components and raw materials still come from China, of course, but the list gets smaller.