TSMC considers Texas expansion as it doubles down on US chip manufacturing efforts

Taiwanese chipmaker TSMC explores Texas alongside Arizona for potential new fabrication plants, aiming to strengthen its US footprint amidst infrastructure and staffing challenges.

TSMC is weighing a major second manufacturing base in the United States, with Texas emerging as a possible site after the company committed fresh billions to its Arizona expansion. The Taiwanese chipmaker has already said it will add $100 billion to its existing Arizona programme, lifting its total planned investment in the state to $265 billion and expanding the build-out to at least four more advanced fabrication plants. Officials in Arizona said the package also includes advanced packaging capacity and a research element, underscoring how central the state has become to TSMC’s US strategy. According to TSMC and Arizona state statements, the new facilities are intended to produce chips at 2 nanometres and below.

That Arizona plan appears to have encouraged speculation about a broader US footprint. Economic Daily News reported that TSMC is now studying Texas as a second American location, where as many as six more advanced wafer fabrication plants could be built. The publication said Taiwanese sources believe the outlay in Texas could ultimately exceed the already enlarged Arizona commitment, although no formal project has been approved. For now, the idea remains at an exploratory stage and TSMC’s board has not signed off on construction in the state.

The appeal of Texas is straightforward. The state already has a semiconductor presence, with Samsung operating sites there, and it offers deeper industrial infrastructure than many other US locations. Dallas is being discussed as a possible anchor point, helped by logistics, energy capacity and a broader labour pool. By contrast, TSMC has faced pressure in Arizona over water availability and staffing, two issues that matter greatly for highly complex chip plants that require large volumes of ultrapure water and a steady flow of skilled technicians and engineers.

TSMC’s US push also reflects the concentration of its customer base in America. More than three quarters of the company’s revenue comes from clients in the United States, yet most of its production remains in Taiwan. Washington has tried to accelerate localisation through subsidies, while Donald Trump has used tariff threats as leverage over the Taiwanese supply chain during his second presidential term. Against that backdrop, Arizona is already set to become TSMC’s largest overseas manufacturing hub, but the possibility of a Texas build-out suggests the company is still considering how far to shift advanced production closer to its biggest customers.