Speaking to investors in January, company CEO C.C. Wei said, "We are entering a period of higher growth, as a multiyear megatrend of 5G, and [high-performance computing]-related applications are expected to fuel strong demand for our advanced technologies in the next several years.
"As we enter the 5G era, a smarter and more intelligent world will require massive increases in computation power and greater need for energy-efficient computing and, therefore, require leading-edge technologies," he said.
The 1,100-acre Phoenix project was long in the works before today's chip shortage hit, said TSMC spokeswoman Nina Kao.
TSMC, which had net revenues of $45.5 billion in 2020 and supplies customers in automotive, mobile phones, high-performance computing and Internet of Things, began considering a U.S. location more than a year ago.
The company's plans weren't to prepare for a possible shortage but to make a strategic move in anticipation of the increasing chip demand.
"We didn't really foresee the chip supply challenges that we are facing right now," Kao told Automotive News. "The current chip shortage is not something that the Arizona fab will be a solution to."
Plant construction is expected to begin this year.