TSMC Advanced Process Prices to Rise 15%

TSMC has announced an expansion of its investment in the United States, with total investment reaching up to $165 billion. U.S. President Donald Trump has suggested replacing direct subsidies with tariffs, signaling a potential shift in U.S. semiconductor policy. Industry analysts predict that price increases for advanced process technologies are inevitable, as the cost of establishing fabs in the U.S. is expected to be factored into pricing. Without subsidies, the cost per wafer produced in U.S. facilities could be 30% higher than in Taiwan, with the additional expenses likely shared with customers.

Since the passage of the CHIPS and Science Act in 2022, the U.S. government has allocated $52.7 billion in subsidies. However, Trump has emphasized that producing chips in the U.S. would exempt TSMC from tariffs, while chips manufactured in Taiwan and shipped to the U.S. could face tariffs of 25%, 30%, or even 50%. This approach significantly reduces the likelihood of TSMC receiving subsidies.

Industry experts estimate that manufacturing costs in U.S. fabs are substantially higher, with depreciation costs alone increasing by approximately 26% and labor costs rising by 66%. Even at full capacity utilization, the cost per wafer at U.S. facilities is expected to be 28.3% higher than in Taiwan. Subsidies would help narrow this gap, but the key factor in profitability remains fab utilization rates.

While tariffs may not directly impact TSMC, the company is under pressure from customers to expand its U.S. operations. The additional costs will be shared across the industry, with analysts forecasting at least a 15% increase in pricing for advanced process nodes to offset these expenses.

Furthermore, financial reports from semiconductor packaging and testing firms indicate that advanced packaging facilities have a high labor cost ratio, and R&D centers require significant investment in talent. Without subsidies, these facilities would not be restricted to hiring local employees. This raises concerns that a substantial number of Taiwan's semiconductor professionals could relocate to the U.S. alongside TSMC.

Despite current investment plans appearing finalized, industry insiders caution that unexpected delays in fab construction could lead to renewed tariff threats from Trump. Additionally, if the U.S. aims to establish an R&D center comparable in scale to Taiwan's global research hub, the risk of advanced process technology outflows will significantly increase.

According to major IDM semiconductor firms, construction delays could push wafer fab completion to 2030, failing to meet customer demand for high-volume production. Industry experts warn that a second round of negotiations may be necessary, particularly regarding IDM supply chain strategies, as global semiconductor policies continue to evolve.