Last month, President Trump criticized the bipartisan CHIPS Act, aiming to dismantle it. Recent reports indicate that the White House seems to be taking steps toward that goal.
An industry association for chipmakers, which includes TSMC, conducted a call expressing their worries about how this could affect their plans for new manufacturing facilities in the US.
‘Made in America’ Apple Chips
Apple revealed its intentions for ‘Made in America’ chips back in 2022, an initiative celebrated as one of the positive outcomes of the US CHIPS Act. This government subsidy program is designed to reduce reliance on foreign sources for advanced chip production and create jobs for American workers.
The plan involves establishing a number of TSMC chip manufacturing plants in Arizona, with some production earmarked specifically for Apple chips for older devices. The first of these plants is expected to commence mass production soon.
Trump’s Criticism of the CHIPS Act
As we noted last month, Trump expressed dissatisfaction with the agreement and signaled that the White House might withdraw from it.
Trump desires to impose taxes on imported semiconductors and eliminate an incentive program that would see Washington subsidizing TSMC’s pledged $65 billion investment in US production with grants totaling $6.6 billion.
While TSMC had seemingly reached a fragile agreement with the administration, announcing a $100 million investment in exchange for ongoing support, this has now been thrown into uncertainty following a new speech by Trump.
Chipmakers Hold a Conference Call
The administration has already made cuts to the team managing CHIPS Act grants, and The New York Times reports that chipmakers convened a call to deliberate on Trump’s latest comments, during which he deviated from his prepared speech and urged Congress to overturn the Act.
Republican lawmakers had sought assurances over recent months that the Trump administration would uphold the program established by Congress. However, midway through his remarks, Trump labeled the law a “horrible, horrible thing.”
“You should abolish the CHIPS Act,” he told Speaker Mike Johnson […]
The day following Trump’s speech, the Semiconductor Industry Association coordinated a call with its member companies, according to three individuals familiar with the conversations. During this discussion, participants attributed Trump’s discontent with the law to his personal grievances with President Biden […]
Executives from chip companies, concerned about potential funding retraction, are consulting legal experts to determine what options the administration has for terminating signed contracts, as reported by eight individuals familiar with those inquiries.
Members of the SIA include AMD, ARM, Intel, Nvidia, Qualcomm, and TSMC.
If CHIPS Act funding is jeopardized, it remains uncertain how this would affect TSMC’s plans for upcoming plants, including the recently announced $100 million investment.
Photo of stock meeting by charlesdeluvio on Unsplash
