Taiwan Semiconductor Manufacturing Co. is assessing further investment in Texas, potentially including Elon Musk’s proposed Terafab, as AI demand stretches its production capacity.
Taiwan Semiconductor Manufacturing Co. is weighing a further expansion in Texas as demand for artificial intelligence chips continues to outstrip its current ability to supply them, according to a report by American Bazaar and comments from the company’s chairman and chief executive, C.C. Wei. TSMC has confirmed that teams have been sent to Texas to assess possible investment opportunities, signalling that the company is looking beyond Arizona as it builds out its US manufacturing base.
Wei said the company was still trying to close a supply gap that remains “far above our capability today to supply”. He said any new investment would support the wider US semiconductor ecosystem, improve supply-chain resilience and create skilled jobs. The Texas review would come on top of TSMC’s existing US commitment, which the company says now totals $265 billion after an additional $100 billion pledge announced in July.
The prospective move also intersects with Elon Musk’s proposed Terafab project in Texas. According to the report, TSMC is discussing a possible role in the complex, which Musk has promoted as a supply base for his own businesses, including Tesla and SpaceX. Wei has indicated that any TSMC-operated plant would need to remain under the Taiwanese company’s control, while Musk has said his firms would build and run the facility, with TSMC potentially leasing part of it. No final agreement has been announced.
TSMC’s interest in Texas comes as the company benefits from an AI-driven investment cycle that continues to lift chip orders and factory utilisation. It said its net profit for the July-to-September quarter rose 69% from a year earlier to NT$763.1 billion, while revenue increased 51% to NT$1.49 trillion. Wei also cautioned that consumer and price-sensitive markets remain under pressure from higher component costs and wider macroeconomic uncertainty, adding that the company is being careful in planning for 2027.
The timing is notable. In January, the US and Taiwan reached a trade agreement that included plans to cut tariffs on Taiwanese goods to 15% in exchange for major investment commitments in semiconductor manufacturing and related supply chains in the United States. TSMC has also said it expects capital expenditure of between $60 billion and $64 billion in 2026, up from an earlier forecast of $52 billion to $56 billion, underlining the scale of the company’s expansion push.
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