TSMC's investment in the US under the Trump administration didn't have strategic motives; instead, it was to avoid a hefty wave of tariffs coming against them. TSMC Apparently Submitted To President Trump's "Tariff Threat", Making a Forced Investment Into The US The Taiwan semiconductor giant isn't in the best of positions when it comes to managing geopolitical tensions and the chip business. TSMC is the leading chip fab company for now; their leadership role wasn't "digestible" by the Trump administration, who had threatened the company with the imposition of tariffs as high as 100% if they didn't announce investments into the US. Interestingly, this isn't a claim; instead, it was said by President Trump himself in a speech at the National Republican Congressional Committee dinner. TSMC, I gave them no money; great company, the most powerful in the world. Biggest chip company in the world. They’re spending $200 billion in Arizona building one of the biggest plants in the world. And that’s without money. All I did was say, if you don’t build your plant here you’re going to pay a big tax, 25, maybe 50, maybe 75, maybe 100 percent. - Trump TSMC announced that it will invest $100 billion in the US, opening four new facilities in Arizona, along with an advanced packaging and R&D center. The deal was labeled as an effort to diversify the supply chain, with the Taiwan giant having an interest in the US. However, it seems like TSMC's determination in the deal wasn't as to what was being shown by the Trump administration, since with the latest comments, it looks like TSMC was forced into a deal by the US government simply because Trump believes that they stole US chip tech. The Taiwan giant's expansion into the US does have its benefits, but it raises tremendous issues for the supply chain, mainly dealing with how complicated the process of transferring cutting-edge nodes to the US is. TSMC has expressed a determination to scale up production to a 1.6nm process by the end of the decade, and while it all seems positive for US chip ambitions, it looks like the start was a forced one. Trump's vision for the US supply chain in general does make sense to a certain extent, but his measures are said to be "radical" and completely unfavourable for businesses. Despite the collaboration with TSMC, the US still decided to tariff Taiwan in the recent rounds, and while chip imports are excluded, it still shows that the Trump administration isn't easy to rely on. Deal of the Day