Financial reports from TSMC or industry analysis reports

TSMC Launches Japan Plant, Arizona Facility to Begin 4nm Production in 2025 with 30% Higher Costs

Dec 30, 2024, 07:00 AM

Taiwan Semiconductor Manufacturing Company (TSMC) has initiated mass production at its first chip fabrication facility in Kumamoto, Japan, marking a significant step forward for Japan's semiconductor supply chain. The Kumamoto plant, operated by Japan Advanced Semiconductor Manufacturing, a TSMC unit, is set to produce the most advanced chips ever made in Japan and officially launched in late December 2024. Meanwhile, TSMC's Arizona facility in the United States is preparing to begin 4nm chip production in the second half of 2025, with an initial wafer output of 20,000 units per month and production costs expected to be up to 30% higher than in Taiwan. Approximately 50% of the 2,200 employees at the Arizona plant are from Taiwan, reflecting a demographic shift in the region. The Arizona facility, supported by the U.S. CHIPS Act, aims to strengthen the domestic semiconductor industry, though challenges such as higher costs and dependency on Taiwanese workers persist. Additionally, TSMC plans to raise prices by 5%-10% for advanced processes like 3nm and 5nm chips and by 15%-20% for CoWoS packaging in response to growing AI demand.