TAIPEI (Taiwan News) — Labor shortages compounded by sporadic COVID-19 outbreaks have delayed the construction of Taiwan Semiconductor Manufacturing Company's (TSMC) foundry in the U.S. state of Arizona by several months.
Chip production equipment, originally forecast to be installed by roughly September this year, will likely not be set up at the fab until early 2023, Nikkei cited sources as saying. In addition to labor and COVID troubles, construction permit complications are also delaying progress.
TSMC typically takes about two years to fully set up a new foundry in Asia. The company’s first American plant is expected to take at least two and a half years.
The delay may not necessarily result in mass production of chips being delayed though, since the company allowed for a buffer period, sources told Nikkei Asia. TSMC has announced it will not start full-scale manufacturing of chips at the Arizona plant until the first quarter of 2024.
Arisa Liu, an expert at the Taiwan Institute of Economic Research, said delays are to be expected as the tech giant goes through the learning curve of how to set up in a new foreign market. Peter Hanbury, a partner with Bain & Co. who specializes in the chip and manufacturing industries, echoed that sentiment, adding that more time is needed to finalize plans with construction partners unfamiliar with the company’s way of operating.
Yet winning a contest for talent with Intel — an industry veteran in Arizona — may be the biggest hurdle. As the state experiences record high levels of employment, Intel is scouting out an additional 3,000 skilled workers to staff its expanded Arizona campus, forcing TSMC to push harder to recruit the right people.
Last year, TSMC Founder Morris Chang (張忠謀) said managing human capital will be one of the biggest challenges his company faces in its push to internationalize operations. There have been reports that TSMC is also facing labor shortages in setting up its new fab in Japan.