Photo Credit: TSMC
We have written extensively about Scottsdale and Arizona’s rise as a manufacturing and corporate hub (get up to date here). The high-tax and high-regulation states that have served as those hubs in the past are getting left in the dust, and Arizona has been one of the biggest beneficiaries of this. A new development is another example of this dynamic coming to life.
In a major leap for tech manufacturing here, Taiwan Semiconductor Manufacturing Company (TSMC) has broken ground on its third semiconductor fabrication plant in north Phoenix, near 43rd Avenue and Dove Valley Road. The facility, expected to begin production by the end of the decade, was intended to produce 2-nanometer or more advanced chip technology, technology that is at the very cutting edge of global semiconductor technology. This even further cements Arizona’s role as a hub for high-tech innovation, IF it goes forward as planned…more on that later.
Originally launched in 2020, TSMC’s Phoenix campus has grown rapidly, with three fabs now underway and strong federal support—including $6.6 billion in subsidies from the CHIPS Act. This milestone not only marks a pivotal moment for Arizona’s economy but also for America’s position in the global semiconductor supply chain—bringing critical infrastructure and innovation back home.
This latest development will create approximately 6,000 new jobs, part of a broader investment strategy by TSMC, which includes over $165 billion committed to U.S. projects and over $200 billion in projected economic impact across Arizona over the next decade. The announcement was highlighted by visits from key figures, including U.S. Secretary of Commerce Howard Lutnick and Nvidia CEO Jensen Huang, both of whom praised the expansion as part of a renewed American manufacturing renaissance.
However, there are a few reasons to be somewhat cautious in this excitement. It is a widely disseminated rumor that TSMC will not in fact be producing the highest tier of chips here in Arizona, and the reason for that is self-preservation. TSMC is based in Taiwan, where they typically hold out production of those best chips to manufacture in their home country. There is a thought that if that production happens in the US, America would have less reason to defend Taiwan from potential Chinese aggression.
Furthermore, the ever-changing tariff landscape may soon make American manufacturing less en vogue. Breaking ground on a new plant is certainly a fantastic sign and means that the company is more “pot committed”, i.e. it’s probably too late to pull back now, the last few months have shown us that there is nothing guaranteed in global trade.
That said, it’s impossible to think of this as anything other than yet another big win for the state of Arizona. Again and again it is demonstrating that it is one of the best states in the country for bringing in new business and high-paying jobs. Regardless of uncertainties in global trade, Arizona is unquestionably on the rise.