TAIPEI (Taiwan News) — The desert outside Phoenix is becoming one of the most important sites in the global chip race.
When UIS asked senior executive C.M. Lai to lead its first US operations, he thought his career was winding down, per Nikkei Asia. Instead, he found himself at the center of one of the world’s most ambitious industrial experiments.
UIS, a major builder of semiconductor facilities for TSMC and Micron, set up in Arizona in 2021 as TSMC broke ground on its first advanced chip plant in Phoenix. Lai soon learned that replicating Taiwan’s model abroad was far harder than expected.
“We underestimated the operating costs, the waiting time to obtain various permits and the level of detail required in the design blueprints in a different geography,” Lai recalled. “You have to embrace the local culture and ways of doing things.”
For years, UIS engineers and suppliers practically lived in “trailer cities” beside TSMC’s construction site, working 15-hour days to keep up with the massive project.
UIS project manager Thomas Liu said he saw young engineers falling asleep when they sat down. “You could really see how exhausted, yet dedicated, everyone was,” he said.
Building semiconductor plants demands precision on an extraordinary scale. UIS senior project manager Vincent Murry explained that each step must be perfectly timed to avoid cascading delays.
“At first, everyone was shouting to get their part done first,” Murry said. “We had to build warehouses, recruit local staff, and develop new supply networks just to keep the schedule moving.”
TSMC’s plans for Arizona have since exploded. What began as a single NT$372.55 billion (US$12 billion) plant has become a NT$5.12 trillion megaproject with at least eight planned facilities for manufacturing, packaging, and R&D. The Phoenix site already produces chips for Apple and Nvidia’s AI processors, and the workforce is expected to swell to 12,000 at peak construction.
Just south in Chandler, Intel is expanding its decades-old Ocotillo Campus and producing chips with its cutting-edge 18A process. Kevin O’Buckley, head of Intel Foundry Services, said the company is proud to make the world’s most advanced chips in the US.
The transformation has been rapid. Since 2020, Arizona has attracted over 60 semiconductor projects worth more than NT$6.52 trillion and 25,000 new jobs, according to the Arizona Commerce Authority. Vic Narusis, the agency’s executive vice president, said it aims to build the largest chip cluster in the US.
Phoenix Mayor Kate Gallego said the city invested NT$6.35 trillion in infrastructure to support the semiconductor ecosystem. “We made a very concerted effort to prioritize semiconductors,” she said, noting that the city designed an ecosystem around TSMC.
In Casa Grande, Taiwan’s Chang Chun Group has built its first US chemical plant to produce high-purity materials essential for chipmaking. “It’s deeply rewarding to see the facility finally coming to life,” said Calvin Su, president of Chang Chun Arizona.
Still, the road has been rough. TSMC and its suppliers faced delays, labor shortages, and higher costs than anticipated. “At first, we thought the inspection for electricity transmission in a small area would take just a day, but it ended up taking three months,” Thomas Liu explained.
TSMC reportedly plans to raise prices for its most advanced chips to offset the costs of overseas expansion. Yet the AI boom is already paying dividends: US clients now make up 76% of TSMC’s revenue, and suppliers like UIS and Marketech have seen their stock values surge more than 60% this year.
Analysts expect the US to lead global chip investment by 2027. AI and supply chain security are driving chipmakers to localize production, said Brady Wang of Counterpoint Research.
Suppliers are now working together to overcome local hurdles. Sunlit Chemical is storing materials for Kuang Ming Enterprise, while logistics firms like Rinchem and NRS Chemicals handle transportation. “No single semiconductor company can address all challenges independently,” said TSMC Spokesperson Nina Kao.
Topco Scientific has also emerged as a key connector, helping smaller suppliers establish a foothold in the US. Topco Scientific co-CEO Daniel Wu said the company is building a platform so businesses can expand overseas and avoid early mistakes.
For construction specialist Rayzher Industrial, the US expansion marks a new era. “It’s different from Asia or Taiwan, where suppliers are clustered closely together and the ecosystem is highly integrated,” said Rayzher Industrial president Joe Chou. He added that the current geopolitical push is creating opportunities.
Industry leaders say the transformation is just beginning. “It’s the dawn of a new era of going global,” said Frank Liang of Gallant Micro Machining. “The next big opportunities lie overseas.”
