It’s a small revolution in the semiconductor industry. Taiwanese foundry TSMC has started production of iPhone chips in its brand new factory in Arizona. And it’s the Apple A16 SoC, which notably equips the iPhone 14 Pro and iPhone 15, which opens the ball on American soil.
A milestone for TSMC and the United States
After four years of construction and planning, TSMC’s “Fab 21” plant in Arizona is finally up and running. According to informed sources, it is already manufacturing Apple’s A16 chip in 4nm in small but significant quantities.
For the moment, this is mainly about testing the site’s production capacities. But volumes should increase rapidly once the second phase of this “Fab 21” is completed. If everything goes as planned, the plant will reach cruising speed in the first half of 2025.
The production launch marks a major milestone for both TSMC and the U.S. semiconductor industry. The Taiwanese foundry has received generous financial support from the U.S. government: $6.6 billion in grants under the CHIPS for America fund, in addition to its initial $12 billion investment.
The same manufacturing process as in Taiwan
According to the information obtained, the A16 chips produced in Arizona use the same “N4P” etching process as in TSMC’s factories in Taiwan. This is an improved version of the 5-nanometer process, sometimes called 4nm for simplification.
Production yields are currently slightly lower than those of Taiwanese factories. But the ramp-up is rapid and parity should be reached in the coming months.
The choice to produce the A16 chip as a priority, one of Apple’s most advanced and strategic components, shows the ambition of this made in USA project. Normally reserved for the iPhone 14 Pro and 15, this SoC could also equip future iPads or the next generation of iPhone SE expected in 2025.
A massive investment and thousands of jobs
TSMC does not intend to stop there. After this “Fab 21”, two other factories are to be built in Arizona, bringing the total investment to more than 40 billion dollars. According to estimates from the US Department of Commerce, these projects will create 6,000 direct jobs in production, as well as 20,000 indirect jobs linked to the construction of the sites.
Despite geopolitical tensions, TSMC is showing that it is possible to transfer to the United States a very high-tech production that has been centered in Taiwan until now. A small revolution that could be emulated by other semiconductor giants. Since TSMC is the only company in the world capable of producing Apple’s ultra-advanced chips, it is very important for Cupertino that its ultra-strategic chips are produced on American soil. If problems were to occur in TSMC’s factories in Taiwan, it would be the tech and the global economy that would slow down. As with iPhones manufactured in India, it is increasingly crucial for Apple to geographically diversify its supplies.