TSMC Postpones Mass Production at Arizona Fab to 2025

TSMC fab
(Image credit: TSMC)

TSMC on Thursday stated that it would have to delay the start of large-scale production at its Fab 21 in Arizona to 2025. The setback comes as a result of an inability to set up all the necessary cleanroom tools in a timely manner, largely due to a shortage of qualified staff. To rectify this, TSMC is deploying approximately 500 of its Taiwanese personnel with hands-on experience in fab tools installation.

"While we are working on to improve the situation, including sending experienced technicians from Taiwan to train local skill workers for a short period of time, we expect the production schedule of N4 process technology to be pushed out to 2025," said Mark Liu, chairman of TSMC, during the company's earnings call with financial analysts and investors. "We are encountering certain challenges, as there is an insufficient amount of skilled workers with the specialized expertise required for equipment installation in a semiconductor-grade facility." 

The hurdles that TSMC encountered are serious enough for the foundry to push back the start of mass production at Fab 21 phase 1 from early 2024 to sometimes in 2025, representing a delay of approximately a year. The company has not yet specified an exact timeline for when in 2025 it plans to begin mass producing chips in Arizona.

It remains to be seen how the delay of TSMC's Fab 21 launch will affect its customers in the U.S. On the one hand, the company can just 're-route' orders from clients like Apple, AMD, and Nvidia to its Taiwan fabs. But on the other hand, its fabs in Taiwan may be running at full capacity in 2024. Furthermore, clients like AMD and Nvidia may want to produce certain items for the U.S. government in the USA and delaying them by a year could be a breach of contract.

Construction of TSMC's Fab 21 phase 1 commenced in April 2021 and concluded around mid-2022, slightly later than originally planned. In December, 2022, TSMC started to install its equipment. Based on standard procedure, a cleanroom setup within a fab typically takes about a year, which is why TSMC originally forecasted that the fab would go online in early 2024.

However, the local workforce's unfamiliarity with TSMC's specific needs has led to various delays in setting up production tools at Fab 21. 

Just last month, TSMC confirmed ongoing negotiations with the U.S. government aiming to secure non-immigrant visas for its Taiwanese specialists to work in the U.S. Based on a Nikkei report, TSMC was going to dispatch some 500 technicians who can set up fab tools as well as mechanical and electrical systems for fabs.

Anton Shilov
Freelance News Writer

Anton Shilov is a Freelance News Writer at Tom’s Hardware US. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

  • TechieTwo
    More than likely TSMC isn't willing to pay a premium for the required skilled labor to jump thru hoops to facilitate their expedited construction plans.
  • PlaneInTheSky
    Just like Foxconn.

    Meanwhile TSMC has no problem expanding its factories in mainland China.
  • hannibal
    Well in China there is are cheaper workers available...
    That is the problem... How western countries can/will compete with countries that has cheaper work force.
  • Co BIY
    This struggle was predictable but it is something TSMC has to work through to become a truly global company.

    It is also predictable that they will be successful. They have the money, skills, product and support. Hard things are still hard.
  • scottslayer
    I think TSMC scared people off when the CEO said he expected American workers to match the Taiwanese 100 hour work week.
    Also according to reports and engineers that applied, the entire business culture revolves around Taiwan, the management building the project speak almost exclusively Chinese, and they look down on foreigners...while building a foreign project.
  • kjfatl
    Intel, TI and Samsung currently have multiple fabs under construction in the US. Are they experiencing the dame delays? Last I heard Intel has pulled production of one of it's nodes in a year.
  • renz496
    PlaneInTheSky said:
    Just like Foxconn.

    Meanwhile TSMC has no problem expanding its factories in mainland China.
    because labor cost is cheap over there.
  • watzupken
    And here we go. The master race to build more and more fabs, and expecting supply to magically improve as if there are no other factors such as, raw material, machinery and labour. Given the heavy dependency on Asia to produce chips for a long time, it is very obvious that there may not be sufficient people with the right training or experience in the short run.