TSMC has plans to open three fabrication plants in the United States
AFP

Taiwan Semiconductor Manufacturing Co. (TSMC), the world's biggest semiconductor manufacturer, plans to invest $100 billion in the United States, in addition to the $65 billion it had previously announced, President Donald Trump announced Monday.

This move aligns with Trump's broader push to boost investments in American manufacturing. The investment will support the development of three new advanced chip plants, expanding beyond TSMC's existing facility and two ongoing projects in Arizona. The expansion is expected to generate tens of thousands of jobs, CNN reported.

Trump Hails TSMC Investment As Key To U.S. Economic Security

Speaking alongside TSMC CEO C.C. Wei at the White House, President Trump hailed the investment as a critical step for enhancing U.S. economic security. TSMC is a key supplier of semiconductors to major tech companies such as Apple, Intel, and Nvidia.

"Semiconductors are the backbone of the 21st century economy. And really, without the semiconductors, there is no economy," the president said, according to AP News.

"Powering everything from AI to automobiles to advanced manufacturing, we must be able to build the chips and semiconductors that we need right here in American factories with Americans skill and American labor," Trump added.

"This is a tremendous move by the most powerful company in the world. It's a matter of economic security, it's also a matter of national security for us," Trump further said, adding that it will also help TSMC diversify away from its current chipmaking operations in Taiwan.

According to Trump, TSMC's investment — along with other similar initiatives — could help the United States capture 40% of the global chipmaking market.

"We're going to produce many chips to support AI progress and to support smartphones progress," Wei said. He also thanked TSMC customers such as Apple, Nvidia, AMD and Qualcomm.

Following the announcement, an Nvidia spokesperson said in a statement that TSMC's new fabs "will be the foundational pillar of a new technology supply chain centered in the United States," adding the company "will fully utilize TSMC's global manufacturing network to enhance our supply agility and resilience."

TSMC Investment, U.S. Chip Policy, And Trump's Tariff Strategy

According to CEO C.C. Wei, TSMC's $165 billion investment will create thousands of high-paying jobs. In 2022, former President Joe Biden signed the $280 billion CHIPS and Science Act to boost U.S. chip manufacturing, especially after the COVID-19 pandemic.

The pandemic caused many overseas chip factories to close, leading to severe supply shortages. This disruption affected industries, halting car production and contributing to inflation. Trump criticized the CHIPS Act, advocating instead for high tariffs on imported chips to incentivize domestic production.

Job Cuts & Geopolitical Concerns Amid TSMC Investment

Also, on Monday, 40 employees from the U.S. Commerce Department who were involved in the CHIPS Act were fired as part of Trump's efforts to reduce the federal workforce, according to sources familiar with the decision.

When asked whether the new investment could help minimize the impact on the U.S. in the event that China isolates or seizes Taiwan, Trump said that it was impossible to "minimize" such a scenario, calling it "a catastrophic event."

Last week, Trump met Apple CEO Tim Cook at the White House. Following the meeting, Apple announced a $500 billion investment in the U.S. over the next four years, including a new server factory in Texas.