Apple CEO Tim Cook Says Company Will Embark in US-Made Chips with Arizona TSMC Factory

Per CNBC

Tim Cook announces that Apple will be using chips made in the USA with the help of TSMC's Arizona factory for the very first time. This provides logistical convenience and a solution to the semiconductor supply issue.

Tim Cook: "Thanks to the hard work of so many people, these chips can be proudly stamped Made in America,”

Tim Cook's announcement was during an event where President Joe Biden also spoke. The Apple CEO said that this step is just the beginning as they plan to combine the expertise of their chip supplier with the "unrivaled ingenuity of American workers."

Taiwan Semiconductor Manufacturing Company (TSMC) will own the Arizona plant. So far, this company owns more than half of the global chip market share and already works with Apple to produce iPhone, iPad, and iMac chips.

Biden described the shift as a "game changer" since the previous steps involved purchasing chips from overseas. Although this allowed Apple to access more affordable hardware, the company has felt the effect on its supply due to trade-route complications and others (Covid-lockdowns).

Arizona factories will be partially subsidized under the CHIPS and Science Act signed by Biden earlier this year. The Act holds billions of dollars in incentives to encourage companies to manufacture chips in America.

Most of TSMC's manufacturing still hails from Taiwan, which has raised concerns for US and European lawmakers. This places TSMC-reliant companies at the risk of a supply crunch should something happen to the country.

Apple, like Nvidia, designs its chips but outsources the manufacturing to companies like Samsung Foundry and TSMC. The Taiwanese chip company says they will spend $40 billion on two chip plants in Arizona.

TSMC plans to produce 600,000 wafers annually, with its first Phoenix plant expected to start production in 2024 and its second plant expected to start in 2026. The US plant totals a fraction of the company's 12 million wafer capacity achieved in 2020.

AMD intends to be a customer of the TSMC Arizona fabs, while Intel plans to compete for Apple's business.

Resources:

CNBC

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