Taiwan has firmly rejected a US proposal for an equal share in semiconductor manufacturing, arguing that America's domestic challenges in infrastructure and workforce development are the true hurdles to its chip independence. Industry analyst Ming-Chi Kuo highlighted that Taiwan's leading semiconductor manufacturer, TSMC, is already advancing its US operations, projecting a substantial increase in American chip production capacity in the coming years.
Taiwan's leadership has made it clear that the US suggestion for a 50-50 split in semiconductor production is impractical and based on an incomplete understanding of the industry's complexities. The island nation maintains its crucial role as a global leader in chip manufacturing, while also expanding its investment in US-based facilities.
Taiwan's Stance on Semiconductor Parity
Taiwan recently reiterated its dismissal of a proposal from the US regarding an equitable distribution of semiconductor fabrication, initially put forth by the Trump administration. Esteemed analyst Ming-Chi Kuo has further elucidated this position, suggesting that Washington's expectations are overly simplistic and overlook fundamental structural deficiencies within the American semiconductor ecosystem itself. According to Kuo, neither the Taiwanese government nor its leading firms, such as TSMC, are the primary constraints on enhancing US self-reliance in chip manufacturing. He characterizes the "50-50" concept as an ambiguous and unfeasible notion, which struggles to offer a concrete foundation for actionable discussions or implementation.
Kuo contends that the genuine impediment to US semiconductor independence stems from its underdeveloped infrastructure and a scarcity of skilled labor. He points out that constructing a new TSMC fabrication plant in the US typically requires 24 to 28 months, a significantly longer period compared to the 16 to 20 months needed in Taiwan, primarily due to regulatory hurdles and workforce challenges. This disparity underscores Taiwan's perspective that the US should prioritize rectifying its internal limitations rather than imposing demanding production quotas on its international partners.
TSMC's US Expansion and Global Supply Chain Realities
Despite Taiwan's rejection of the proposed 50-50 production split, TSMC's expansion efforts within the United States are reportedly progressing ahead of schedule. The company's strategic plan, known as "6 + 2 + 1," encompasses the establishment of six advanced-node fabrication plants, two advanced-packaging facilities, and one research and development center. TSMC's initial Arizona-based fabrication plant has already commenced mass production, with the second facility's timeline accelerated to the latter half of 2027, now incorporating advanced 2-nanometer technology. By 2032, with the full operation of all six fabs, Kuo anticipates that US output could contribute approximately 25–30% of TSMC's total global manufacturing capacity.
However, Kuo issued a caution: merely relocating chip production from Taiwan to the US would not guarantee genuine self-sufficiency if critical dependencies on the global supply chain, particularly regarding specialty chemical suppliers from Japan, remain unaddressed. He advocates for the US to concentrate its efforts on bolstering its indigenous semiconductor infrastructure and cultivating a skilled workforce, rather than insisting on specific production commitments from Taiwan. Meanwhile, Taiwan continues to be a crucial player in the global semiconductor industry, with its vice premier clarifying that no commitment was ever made to the "50-50" plan. While TSMC is investing heavily in its Arizona facilities, the majority of its manufacturing operations will continue to be based in Taiwan, underscoring the island's enduring significance in the global chip landscape.