Taiwan Semiconductor Manufacturing Company (TSMC) has recently announced the delay of the construction of its second chip plant in Kumamoto, Japan, opting to prioritize funding for expansion in Arizona, USA.

This decision was primarily influenced by former President Trump's threats of tariffs on imported chips, prompting TSMC to accelerate its investment in the U.S. According to reports from The Wall Street Journal, the Kumamoto plant, initially scheduled to begin construction earlier this year, has faced further delays due to funding allocations and geopolitical considerations, with a specific start date yet to be determined.

In March, TSMC announced at a White House press conference that it would invest at least $100 billion in the U.S. over the next several years, surpassing its earlier commitment of $65 billion, indicating that domestic chip production in the U.S. has become a primary strategic goal for the company.

Additionally, TSMC is also under scrutiny from the U.S. Department of Commerce regarding its business dealings with Chinese design firm SOPHGO, amidst concerns that over 3 million chips ordered by SOPHGO may have been resold to Huawei for use in its Ascend 910B processor. Trump has threatened that if TSMC fails to fulfill its plant construction plans, it could face 100% tariffs.

While the Japanese government had hoped TSMC's Kumamoto plant would commence swiftly to boost the local semiconductor industry, and had promised $8 billion in funding, TSMC previously indicated that the project would encounter "slight delays" due to local traffic congestion. Japanese officials responded that they had not received communication indicating that traffic issues were the primary reason for the delay and expected production capacity and timelines to remain unchanged.

Aside from the U.S. and Japan, TSMC had also begun construction on its first European facility in Germany at the end of last year, which is projected to commence production by the end of 2027. Governments around the world view semiconductors as a strategic industry, actively vying for TSMC's investments.