Some of the staggering $500 billion that Apple pledged Monday to invest in the U.S. will go to the massive Taiwan Semiconductor Manufacturing Company (TSMC) factory in Phoenix.
Mass production of Apple chips began there last month, Apple said.
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President Donald Trump expressed doubts last year about federal support for the TSMC project under President Joe Biden. After Apple’s announcement, the White House credited Trump’s tariff threats for bringing jobs and investment to Arizona and three other states.
The exact boost for Arizona isn’t yet clear. Apple CEO Tim Cook announced in late 2022 that his company would be the biggest customer of TSMC’s Arizona facility. TSMC makes 90% of the world’s most advanced chips.
Apple said it will spend the $500 billion over four years, adding 20,000 U.S. jobs. Including the TSMC chip deal, it will expand manufacturing and data centers in Arizona and other states.
“This is bullish for TSMC in Arizona and the Apple buildout and this stepped-up partnership,” Daniel Ives, a technology sector analyst at Wedbush Securities, said by email. “We can see more jobs being added to Arizona over the coming years.”
The $65 billion TSMC factory in Phoenix – the largest foreign investment in state history – is expected to manufacture tens of millions of leading-edge logic chips that will power products like 5G/6G smartphones, autonomous vehicles and high-performance computing and AI applications. Mass production of 4-nanometer chips, among the most advanced, began late last year.
Once completed, the TSMC factory will provide about 6,000 high-tech, high-wage jobs and support another 10,000 jobs indirectly, the company said.
The factory is being built in stages. The company expects the second fabrication facility to be producing leading-edge 3-nanometer chips by 2028. The third fab is expected to start production by the end of the decade, making 2-nanometer chips or even more advanced chips.
Cook met with Trump last Thursday at the White House. Speaking to a group of visiting governors on Friday, the president took credit for prodding the maker of iPhones and Macbooks to shift manufacturing to the U.S.
“They stopped two plants in Mexico that were under construction,” he said. “They are going to build here instead because they don’t want to pay the tariffs.”
Trump has threatened 25% tariffs on semiconductors imported from Taiwan.
The Biden administration sought to bolster domestic production with incentives rather than tariffs.
It gave TSMC $6.6 billion in grants for the Phoenix plant plus $5 billion more in loans. The funds were part of the $280 billion CHIPS and Science Act, which included about $53 billion to boost domestic chip research and production.
Amid fears that Trump would slash the subsidies, the Biden administration locked in the payment as one of its final moves.
Apple announced a number of expansions on Monday, including a 250,000-square-foot facility in Houston expected to open next year. That will assemble servers needed for Apple Intelligence and Private Cloud Compute – artificial intelligence products.
The servers currently are made overseas.
“We’ll keep working with people and companies across this country to help write an extraordinary new chapter in the history of American innovation,” Cook said in a press release.
