Apple Supplier TSMC’s Arizona Chip Plant Faces Construction Delay

Apple supplier TSMC’s Arizona plant is having problems due to labour shortages and COVID-19.

According to Nikkei Asia, TSMC, the world’s largest contract chipmaker, which is responsible for Apple’s A- and M-series processors, is finding it more challenging to expand overseas than at home:

TSMC initially planned to start moving in chip production equipment by around September this year, but the company has told suppliers that this will be pushed back to around February or March of 2023, several people with knowledge of the matter told Nikkei Asia.

The facility, once complete, will be TSMC’s most advanced outside of its home region. However, the Arizona plant is proving problematic due to labour shortages and the ongoing COVID-19 pandemic.

“Complicated processes for obtaining the different types of licenses needed for construction was another factor,” the report also notes.

“It’s generally taking longer to build a chip plant because of the pandemic and all the other supply chain disruptions,” said Arisa Liu, a veteran semiconductor analyst with the Taiwan Institute of Economic Research. “TSMC will have to negotiate details for subsidy packages with governments and also learn local regulations and apply for all kinds of licenses in a foreign destination.”

Generally, these plants take about 12 to 15 months from groundbreaking to equipment move-in. However, the challenges presented in building in a foreign country make this timeline much longer.

Despite the delays, TSMC expects it will still reach its production start in early 2024. The timeline for installing and testing equipment will be shorter, but the production should begin on time.