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Biden Gets Victory Lap With $12 Billion TSMC Plant, Arizona Wins

(Bloomberg) -- President Joe Biden will help celebrate a landmark step in Taiwan Semiconductor Manufacturing Co.’s construction of a $12 billion facility in Arizona next Tuesday -- its first advanced chip plant in the US -- a White House official said, capitalizing on his efforts to reinvigorate manufacturing in a politically crucial state.

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During the visit to the TSMC construction site in Phoenix, the president will discuss how he plans to rebuild supply chains in the US and create jobs in Arizona and across the country, the official added.

Arizona has emerged as one of the most competitive political battlegrounds in the country. Biden’s victory in the state helped him win the presidency in 2020, and Democrats there won narrow elections for governor and a US Senate seat earlier this month. The Republican gubernatorial candidate, Kari Lake, is an ally of former President Donald Trump who has echoed his false claims about widespread fraud in the last presidential election and is contesting her own defeat.

The Dec. 6 “first tool-in” ceremony, in which TSMC will symbolically move equipment into a building, will be attended by company founder Morris Chang, Chairman Mark Liu, and Chief Executive Officer C.C. Wei. TSMC announced in 2020 that it would build the plant and has said that it expects to begin production in 2024, initially making 20,000 wafers of relatively advanced 5-nanometer chips per month.

While the volume is modest and the technology will be at least one generation behind the latest available chips when the plant comes online, TSMC’s new site could be a turning point in the Biden administration’s efforts to bolster chip manufacturing in the US.

Apple Inc. is preparing to begin sourcing chips for its devices from a plant under construction in Arizona, likely the TSMC factory, Bloomberg News reported.

Earlier: Apple Prepares to Get Made-in-US Chips in Pivot From Asia

The US has sought to reduce its reliance on Taiwan and other Asian nations after the coronavirus pandemic exposed the world’s dependence on their chips. Over the past two years, shortages of semiconductors caused production stoppages affecting industries from medical devices to consumer electronics and led some automakers to furlough workers.

The Biden administration intends to bolster domestic manufacturing through the $50 billion in subsidies from the Chips and Science Act that the president signed into law in August. TSMC is likely to receive billions in subsidies.

Intel Corp. and South Korea’s Samsung Electronics Co. are among the companies that have announced plans for new cutting-edge facilities in the US.

Still, Taiwanese officials and TSMC executives have insisted that they will keep the latest technology housed in Taiwan, creating a potential obstacle for the White House to secure the most advanced chips on US soil.

TSMC is laying the groundwork for a second plant in Arizona, that will make more advanced 3-nm chips, although it hasn’t made a final decision on whether to proceed.

Commerce Secretary Gina Raimondo, whose department is responsible for distributing the chips subsidies, is also set to attend the Tuesday ceremony.

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