TSMC to Delay Kumamoto Fab 2, Boost U.S. Investment

According to reports, TSMC has postponed construction of its second fab in Kumamoto, Japan, in part due to the company's accelerated capital deployment toward expanding its manufacturing capacity in the United States—an adjustment believed to be driven by concerns over potential semiconductor tariffs under a future Trump administration.

Industry analysts suggest the shift reflects how the former president's aggressive trade policies—particularly tariff threats—are prompting companies to prioritize U.S. investments, often at the expense of other allied nations. TSMC, which has active expansion plans in the U.S., Japan, and Europe, emphasized that its global manufacturing strategy is based on customer demand, business opportunities, operational efficiency, government support, and overall cost effectiveness. The company reiterated that its U.S. plans will not affect its existing commitments elsewhere.

While TSMC declined to comment directly on the Kumamoto delay, it previously stated that construction of the second plant, part of a $20 billion investment plan supported by over $8 billion in Japanese government subsidies, would begin in early 2025. The first Kumamoto fab, serving major clients including Toyota, began mass production in late 2024. However, TSMC Chairman Mark Liu noted in June that traffic congestion in the area had already pushed back construction timelines. Sources now suggest the delay may be extended further, with no firm date set for groundbreaking.

TSMC's strategic recalibration coincides with increased pressure from U.S. officials to strengthen domestic chip production. In March, the company committed an additional $100 billion to its U.S. operations. Meanwhile, Washington is reportedly exploring new tariff measures targeting semiconductors, fueling urgency among chipmakers to reinforce U.S. production capacity.