UPDATE 2-TSMC plans advanced chip production in Arizona, says company founder

(Adds more quotes from Chang)

By Sarah Wu

TAIPEI, Nov 21 (Reuters) – Taiwanese chipmaker TSMC plans to produce chips with advanced 3-nanometer technology at its new factory in the U.S. state of Arizona, but plans are not yet fully finalized , company founder Morris Chang said Monday.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC), a major supplier to Apple Inc and the world’s largest contract chipmaker, is building a $12 billion factory in Arizona.

Last year, Reuters announced TSMC’s plans to build more chip factories in Arizona, including discussions on whether its next factory should be more advanced, which could manufacture chips with 3 nanometer technology versus the slower, less efficient 5 nanometer chips that will be produced when the factory begins production.

Chang, speaking to reporters in Taipei after returning from the APEC summit in Thailand, said the 3 nanometer factory would be located at the same site in Arizona as the 5 nanometer factory.

“Three nanometers, TSMC currently has a plan, but it hasn’t been fully finalized,” said Chang, who retired from TSMC but remains influential in the company and the chip industry in general.

“It’s almost been finalized – at the same site in Arizona, phase two. Five nanometers is phase one, 3 nanometers is phase two.”

TSMC, Asia’s most valuable listed company, declined to comment.

The company is hosting a “tool-in” ceremony in Arizona on December 6.

Chang said he would be there, along with TSMC customers and suppliers and U.S. Commerce Secretary Gina Raimondo.

Chang added that US President Joe Biden had also been invited, but was unsure whether he would come.

Taiwan’s dominance as a maker of chips used in technology from cellphones and cars to fighter jets has raised concerns that the world is too dependent on the island, especially as China steps up military pressure to assert its claims of sovereignty.

The United States and Europe are rolling out billions in incentives to get companies to manufacture chips closer to home, courting Taiwanese companies in particular.

Chang said people have just realized the importance of tokens.

“There are a lot of jealous people, jealous of Taiwan’s excellent chip manufacturing,” he said. “So there are also a lot of people who, for various reasons, whether for national security or to make money, hope to manufacture more chips in their country.”

Chang said in his APEC meetings “many countries have asked me, can we go to their country to make chips?”

He did not say which countries it was. (Reporting by Sarah Wu; Writing by Ben Blanchard; Editing by Edmund Klamann, Muralikumar Anantharaman and Gerry Doyle)

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