Taiwan Semiconductor Manufacturing Co. has completed construction of its second Arizona facility and plans to accelerate volume production by several quarters to meet surging customer demand, according to supply chain sources familiar with the project.
The 3-nanometer fab is currently undergoing cleanroom installation and mechanical integration, with equipment suppliers notified of an October 2026 startup timeline. Mass production is now targeted for the fourth quarter of 2027, significantly ahead of the original 2028 schedule.
The acceleration comes as President Donald Trump announced plans for 100% tariffs on semiconductor imports while promising exemptions for companies that move production to the US. Trump specifically mentioned TSMC’s $200 billion US investment commitment during the same White House event where Apple pledged an additional $100 billion in domestic spending.
TSMC’s rush reflects mounting pressure to establish meaningful US production capabilities. The company’s third Arizona fab, targeting 2-nanometer and A16 processes, began construction in April 2025, while plans for fourth, fifth and sixth facilities depend on customer requirements.
The chipmaker’s advanced packaging operations will also expand stateside, with a facility expected to break ground in 2028 connected to the third fab. Industry sources indicate the initial focus will be on System-on-Integrated-Chip and Chip-on-Substrate packaging rather than the company’s flagship Chip-on-Wafer-on-Substrate technology.
TSMC anticipates US production will eventually handle roughly 30% of its 2-nanometer and smaller process technology. The timeline acceleration underscores how geopolitical tensions are reshaping global semiconductor manufacturing, with companies prioritizing supply chain resilience over cost optimization.
For TSMC, the strategy appears calculated: establish sufficient US presence to avoid punitive tariffs while maintaining pricing power through technological leadership. The company’s ability to pass increased costs to customers through higher prices should help preserve margins even as manufacturing expenses climb.
