Semiconductor manufacturing is becoming a hot issue once again in the U.S. as the Trump Administration turns its attention to the expansion of domestic chipmaking.
Step one in the strategic plan is to institute tariffs on foreign made semiconductors coming as soon as next week, according to multiple reports.
President Trump told CNBC that the government is focused on having semiconductors made in the U.S. domestically. The tariffs imposed could be as high as 20% for Taiwan, or 15% in the case of Korea and Japan.
The stance follows the Biden Administration’s heavy focus on incentives for companies to build new chip fabs in the country through the CHIPS and Science Act.
While Trump called on the CHIPS Act to be rescinded, the Biden Administration already had issued up to $50 billion in incentives over the past four years for companies to create or expand semiconductor manufacturing, advanced packaging technologies and assembly facilities.
However, the Trump Administration has followed through with many investments that were already under way including:
- TI’s $60 billion reshoring efforts
- Micron’s $200 billion investment
- GlobalFoundries’ $16 billion reshoring plan
- TSMC’s expansion to three fabs in Arizona
TSMC to invest more?
Interestingly, Trump said that TSMC, which is already committed to spending $165 billion in the U.S. for up to four semiconductor fabs in Arizona, could be looking to invest nearly double this amount due to the new tariffs that will likely be imposed on Taiwan.
If true, which TSMC has declined to comment on, it would make the already largest foreign investment in the U.S. that much larger and create a new global supply chain powerhouse domestically.
TSMC is not just the largest pure-play foundry but the largest chipmaker in the world and manufactures chips for some of the largest chip vendors such as Apple, Nvidia, Qualcomm, Broadcom and many more.
There is some speculation TSMC could invest this amount in Arizona in exchange for a reduced tariff rate imposed on imported goods.
