TSMC says its US investment won't hurt global projects

Taiwan Semiconductor Manufacturing Co. (TSMC) has denied that its US investments are affecting global projects.

This follows a Wall Street Journal report suggesting delays in its second fabrication plant in Japan.

TSMC said its expansion is based on customer demand, business opportunities, and government support.

It emphasized that US projects will not hinder developments elsewhere.

The WSJ report linked the delay of the second Kumamoto plant to a US focus amid potential tariffs under Section 232 of the Trade Expansion Act.

TSMC’s first Kumamoto plant began operations in late 2024. The second plant, set to start construction in early 2025, has been delayed.

Chairman C.C. Wei said traffic concerns caused the delay, and the company is working with local authorities.

🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ Semiconductor tariffs could severely impact expansion economics

TSMC’s global expansion dilemma highlights how tariffs can dramatically alter the financial calculations for chipmakers investing abroad.

According to analysis, a 10% tariff could increase TSMC’s $100 billion U.S. expansion costs by $6.4 billion, potentially undermining the viability of these projects despite government incentives 1.

This tariff impact extends beyond individual companies to the broader economy, with research indicating that a 25% semiconductor tariff could decrease U.S. GDP growth by 0.18% in the first year and 0.76% over ten years, resulting in a cumulative loss of $1.4 trillion 2.

For TSMC and peers, this creates a complex calculus: the Commerce Department has allocated $32.5 billion in grants and $5.85 billion in loans to support semiconductor projects 3, but these benefits could be partially offset by tariff-induced cost increases.

The company’s denial of shifting priorities away from Japan illustrates how chipmakers must carefully navigate contradictory government policies that simultaneously incentivize and potentially penalize foreign investment.