TSMC's $100B US investment only accounts for 7% of company's output — Taiwan gov't gives official blessing for project

TSMC announced its new $100 billion investment in the United States yesterday, stoking excitement for the U.S. chipmaking industry as well as some fears for the fate of Taiwan. In the morning after the dust has settled, TSMC and Taiwan are making it clear to the press that their relationship and shared commitment to each other is still ironclad.

Taiwan Premier Cho Jung-tai addressed the press in a conference following TSMC CEO C. C. Wei and President Trump's joint conference, which announced TSMC's plans to build a new advanced-node fab, advanced packaging plant, and R&D center in the United States. Many speculators questioned whether the big move, an addition to TSMC's existing commitment to build several new fabs in America, was made with the blessing of the Taiwanese government.

Premier Cho's address began with restating how "[Taiwan's] government and local industry sectors have maintained a consistent level of communication and understanding". Without explicitly confirming his government's level of involvement in the move, Cho suggested that this strong communication was a throughline in TSMC's planning to expand its reach in the U.S.

Michelle Lee, spokesperson for Taiwan's executive branch, also clarified the strong allyship between Taiwan and the United States. Currently, 30% of Taiwan's foreign investments are connected to the United States, making it by far the largest investment destination for the island nation. This contrasts sharply with 7.5% of Taiwan's investments going to China, which is consistently dropping. Lee and Cho both reiterate that growth for TSMC is growth for Taiwan, as a stronger company means a stronger GDP, therefore allowing the country to be a more desirable, stronger ally for other nations.

As for the scope of TSMC's involvement in the United States, the chipmaker will not exactly be moving its base of operations to the Silicon Desert of Arizona. According to Ming-Chi Kuo, a foremost expert in market analysis of the Asia-Pacific tech world, TSMC's advanced-process fabs in the United States will only account for 5-7% of the company's total output after all construction completes. This 7% number is larger than it seems — advanced process nodes are produced at a much smaller scale than mature node chips — but still does not point to a total TSMC exodus to the U.S.

Client companies like Nvidia and Apple will still rely on importing supply from Taiwanese fabs (and paying the accompanying tariffs), and the U.S. fabs will rely heavily on technical expertise and monitoring from TSMC's Taiwan base. For Nvidia's part, the company recently posted its recommitment to TSMC on X (formerly Twitter), sharing that the new fabs will be a pillar of a new stateside chip supply chain. Nvidia hopes to "fully utilize TSMC's global manufacturing network to enhance our supply agility and resilience."

All of TSMC's new investment in the U.S. is still subject to regulatory review from Taiwan, which will be weighted towards keeping Taiwan a fixture in the global semiconductor industry. The same is true for TSMC's fab investments in Germany and Japan, which will likely see some scaling back in response to the major U.S. investment. The U.S. chipmaking industry is about to see a major shift towards self-sufficiency thanks to TSMC, though whether it will be enough on its own to make the nation a powerhouse of semiconductor manufacturing remains to be seen.