TAIPEI (Taiwan News) — Cost issues, personnel management, and cultural differences have some at Taiwan Semiconductor Manufacturing Co. (TSMC) worried, as their company steams ahead with US$40 billion (NT$1.21 trillion) in investment for its upcoming Arizona chip plants. 

According to 11 TSMC employees who spoke with the New York Times, the U.S. investment could become a distraction for the company, which has so far relied on a relentless focus on research and development to stay ahead of the market. The New York Times did not name the employees, as they were reportedly not permitted to speak publicly.

The TSMC employees are not the only skeptics. “TSMC’s investment in the U.S. from a business perspective makes no sense at all,” said former tech analyst and private equity firm Kirkland Capital Chairman Kirk Yang (楊應超), citing the high cost of the project. Yang believes it is possible TSMC may have embarked on the U.S. based project due to political pressures, but said “so far, the Phoenix project has yielded very little benefit for TSMC or Taiwan.”

Constructing the fabs in Arizona is reportedly 10 times more expensive than in Taiwan, a result of unfamiliarity with U.S regulations, and insufficient supply of building materials, The NYT said. High inflation, and competition with Intel, which is also expanding in Arizona, is also reportedly driving up costs.

After TSMC founder Morris Chang (張忠謀) told Nancy Pelosi that U.S. plans for the semiconductor manufacturing industry were “incredibly naïve,” Pelosi also reportedly admitted that Taiwanese executives specifically questioned her about whether or not the U.S. environmental and labor laws were sufficient to support such a complicated industry.

Labor relations are also at top of mind for the interviewed TSMC employees, who said that they worried the Taiwanese working style might clash with American employees. Eight of the employees interviewed said they believed they would have to pick up the slack for their American counterparts if they were to work alongside them in Arizona.

Former TSMC engineer Wayne Chiu, said that he had considered joining the company’s U.S. operations, but abandoned the idea after realizing he would have to make up for his American colleagues’ lack of productivity. Chiu said the biggest issue would not be the technology, but the people.

“The most difficult thing is personnel management,” Chiu said. “Americans are the worst at this, because Americans are the most difficult to manage.”