TSMC delays chip production at Arizona plant

Taiwan Semiconductor Manufacturing Company, or TSMC, the world's largest chipmaker, will delay mass production of chips at its new Arizona-based chip plant until 2025 due to a shortage of skilled labor, the company's chairman said on Thursday.

TSMC Chairman Mark Liu told analysts that the company does not have enough skilled workers to install advanced equipment at the facility on its initial timeline. He said the company is working to bring in trained technicians from Taiwan to train local workers to help accelerate installation.

The company had anticipated that it would begin making 5-nanometer chips in 2024. While TSMC has revised its timeline for the mass production of 4-nanometer processors at the Arizona plant, the company is already making 3-nanometer ones that are expected to be in the iPhone 15 Pro and M3 Macs.

TSMC began work on a first factory in Arizona in 2021. Since then, the plant has seen safety concerns, complaints from TSMC about US taxation and a claim that US staff members do not work hard enough.

"We are encountering certain challenges, as there is an insufficient number of skilled workers with the specialized expertise required for equipment installation in a semiconductor-grade facility," Liu said. "Consequently, we expect the production schedule of N4 (4-nanometer) process technology to be pushed out to 2025."

The company posted a second-quarter profit plunge on Thursday as demand for consumer electronics continues to slump.

Significant dependence

The COVID-19 pandemic highlighted the significant dependence the United States has on Asia to develop computer chips, which the US said creates a national security risk and gives the US less control over the supply chain.

The US is making a major push to bring semiconductor manufacturing back stateside, including through the funding of the multibillion-dollar CHIPS and Science Act.

But companies like TSMC and Samsung said it is challenging to operate chip factories in the US because it is difficult to secure sufficient technical talent in the US. Chip manufacturing requires highly skilled workers who cannot be trained in a short period of time.

According to a report from Deloitte, the US semiconductor industry could face a shortage of about 70,000 to 90,000 workers over the next few years.