TSMC Accelerates 3nm Chip Production in Arizona Amid Growing Demand

TSMC Accelerates Second Arizona Chip Plant Construction | AIM

Regardless, advanced packaging, including Chip-on-Wafer-on-Substrate, will continue to be handled in Taiwan. Taiwan Semiconductor Manufacturing Company (TSMC) has begun construction of its second plant in Arizona ahead of schedule, with installation slated for completion in the third quarter of 2026. The facility, known as P2 (second plant), will utilise a three-nanometre (3 nm) process and is expected to begin production in 2027. The move addresses growing customer demand for US-based manufacturing and aims to respond to trade measures such as US tariffs, The Commercial Times reported. Equipment installation is expected to begin as early as September 2026, with full production targeted for the following year. Construction on P2 officially commenced in April 2025. The two-year build time reflects a compressed schedule, with the project running at full speed to meet customer needs. Equipment vendors noted that post-construction, internal factory adjustments typically require around two years. The project is also expected to benefit Taiwanese engineering companies, such as Han Tang and Fanxuan, which previously worked on TSMC's first Arizona facility (P1). Supply chain participants indicated these firms are expected to improve long-term profits due to prior experience. Meanwhile, suppliers of speciality gases and chemicals are set to receive increased orders from North America, with companies such as Shangpin and Shengyi attracting positive attention from market analysts. Despite these developments, Taiwan remains a central part of TSMC's operations. Advanced packaging, including Chip-on-Wafer-on-Substrate (CoWoS), will continue to be handled in Taiwan. Although TSMC has announced plans for two advanced packaging facilities in the US, construction of the first, AP1, is not expected to begin before the third quarter of 2026. Industry sources told The Commercial Times that most of TSMC's US plant developments are unlikely to reach full capacity before 2029. In the meantime, prices for US-produced wafers are expected to rise by over 10%, while global wafer prices are anticipated to increase by 3% to 5% next year, driven by demand for AI and increasing construction costs. TSMC's investment in its home market continues. Nine new factories and 11 production lines are currently under development in Taiwan. Among these, the Kaohsiung F22 plant for 2-nm technology is scheduled for relocation in Q3 2025, with a third facility expected to be completed by Q1 2026.

TSMC's Arizona Fab Accelerates 3nm Efforts Amid Huge Demand From Big Tech; Mass Production Now Expected By 2027

Well, it seems like TSMC's US operations are currently booming right now, and with that, the Taiwan giant has apparently accelerated the timeline for producing 3nm process at the Arizona fab. The Taiwan giant is heavily focused on its US facilities, particularly the one in Arizona, given that tech giants have a massive demand for sourcing semiconductors domestically. Under President Trump's "Made in USA" narrative, TSMC has made significant efforts to upscale its US operations, especially after the company's massive $165 billion investment in America, which offered to bring several new facilities and R&D centers. According to a report by Ctee, TSMC is quickly proceeding with preparing 3nm production lines in Arizona, and the schedule has been advancing rapidly. The Taiwan giant is said to bring in respective equipment for 3nm production in Arizona as soon as September, with production expected to commence by 2027. This means that the U.S. is around two years behind when it comes to what is being produced in Taiwan, which is a massive achievement, considering that just a year ago, there were no signs of TSMC producing cutting-edge nodes domestically. Given this move, it is evident that TSMC has made the U.S. its second home apart from Taiwan, and considering the gigantic demand the company faces from the AI segment, they must create a diverse supply chain, and this has already started to happen, judging by how TSMC is now ready to expand its production in America, by introducing nodes up to A16 (1.6nm). The firm also has plans to open up new advanced chip fabs and, most importantly, packaging facilities, which it desperately needs. There's no doubt that TSMC's recent moves shows that the firm is ready to maintain its dominance over the chip markets, and despite being a firm originating from Taiwan, it has done way more than any other US-based chip manufacturer, and this shows the corporate commitment TSMC currently has, to satisfy the demands coming from its customers.