TSMC Investment Surge: Potential US$200 Billion and 30,000 Jobs

US Secretary of Commerce Howard Lutnick announced on Thursday that he anticipates Taiwan Semiconductor Manufacturing Co (TSMC) could increase its investment in the United States to over US$200 billion, potentially creating 30,000 jobs. This statement came during a televised interview on CNBC, where Lutnick discussed the implications of the CHIPS Act and its financing strategies.

Lutnick was critical of the CHIPS Act, arguing that it offers excessively generous subsidies to semiconductor manufacturers. He pointed out that the administration of former President Joe Biden provided US$11 billion to Intel, which he described as akin to a “shareholder Christmas card.” Furthermore, he noted that the Trump administration had transformed grants and funds from the CHIPS Act into equity stakes in Intel, raising questions about the effectiveness of these subsidies.

Regarding TSMC, Lutnick highlighted the US$6 billion investment to support the company’s plans for a US$60 billion investment in American manufacturing. He stated, “They went up to US$160 billion. I think we are going to get it up to US$200-plus billion in plants in America,” despite not providing evidence to substantiate his claim.

Initially, TSMC committed to investing US$65 billion for the construction of three advanced semiconductor fabrication facilities in Arizona under the CHIPS Act. Of these, the first plant has commenced mass production, while the remaining two are at various stages of their construction timelines. Earlier this year, TSMC announced an additional commitment of US$100 billion for a new complex, which is planned to include three more semiconductor fabs, two advanced packaging facilities, and a research and development center. However, progress on these initiatives appears to be stalled at this time.

Lutnick underscored that former President Trump opposes the notion of government funds being distributed as giveaways. He said, “This concept of the government just being a giveaway of your tax dollars, Donald Trump just doesn’t stand for it. He wants the American people to get the benefit of the bargain.” This perspective aligns with Trump’s broader economic strategy, which has often favored imposing tariffs on imported goods to stimulate domestic investment.

While Lutnick’s comments reflect a vision for increased investment, he did not address the potential negative impacts of Trump’s tariffs, which have contributed to rising corporate bankruptcies in the United States. Economists have indicated that these bankruptcies are nearing a 15-year high, disproportionately affecting small businesses.

In summary, Lutnick’s remarks about TSMC’s potential investment in the United States encapsulate a broader discussion about the effectiveness of government subsidies and the economic strategies of past administrations. As TSMC continues its expansion in the U.S., the trajectory of its investments will be closely monitored by industry analysts and policymakers alike.