Semiconductor giant faces US delays while racing ahead in Japan amid Biden chips funding uncertainty

A major Taiwanese chip manufacturer’s plan to build a key factory in the U.S. has been plagued with significant delays. Meanwhile, the chipmaker is on schedule to open a separate facility in Japan.

One of the plants Taiwan Semiconductor Manufacturing Company (TSMC) is building in Arizona has delayed manufacturing until 2027 or 2028 instead of 2026 because of uncertainty regarding funding it will receive from President Joe Biden’s administration, according to The New York Times. TSMC’s factory in Japan is on track to operate on schedule as the country’s government has helped the factory by committing billions in funding and assisting with assembling thousands of employees to build it, the WSJ reported.

President Joe Biden has made domestic chip production a key priority as the U.S. attempts to wrestle control of the chip market from a key adversary — China.

A brand new semiconductor fab in under two years!

Japan demonstrates Asian smartness and efficiency.

A new TSMC chipmaking plant for nearly $9 billion has opened in Kumamoto, along with an ecosystem of other companies.

Meanwhile in Arizona, everything is delayed. pic.twitter.com/TUPn6tiSJ9

— S.L. Kanthan (@Kanthan2030) March 14, 2024

TSMC also delayed its other Arizona factory because of worker issues, as the giant originally scheduled completion for 2024, but now the plant won’t be operational until 2025 at the earliest.

“What TSMC is contemplating doing in Arizona is pathbreaking,” Commerce Department Secretary Gina Raimondo said, according to the WSJ. “We’re going to make sure it’s successful.”

TSMC’s negotiations with the Biden administration on subsidies have been going on for over a year and a half since the president signed the Chips and Science Act in 2022, which allocates $53 billion to support the industry, according to the WSJ. Chip manufacturers have requested more funding than is available, which has led the administration to struggle in finalizing funding decisions, Raimondo said in February.

The chip giant said the projects in the U.S. and Japan do not merit comparison because of distinguishing factors such as size and complexity, according to the WSJ. The Commerce Department has only doled out three grants thus far, according to the NYT.

American chip giants Microchip Technology and Intel also face delays for their factories although they attribute the setbacks to the current chip market rather than funding uncertainty.

TSMC, the White House, and the Commerce Department did not immediately respond to the Daily Caller News Foundation’s request for comment.

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