TSMC’s Inclination Towards the US Raises Concerns in Taiwan, But Core Technology Remains Local
The debate around TSMC’s growing presence in the United States has intensified, with new reports highlighting concerns among the Taiwanese public and industry experts. According to UDN, a recent poll revealed that 50% of respondents worry about TSMC becoming “TSMC of the United States.” This sentiment reflects rising unease over the chip giant’s strategic pivot toward US-based operations following substantial investments encouraged by the Trump administration.
Scholars from Taiwan’s National Chengchi University argue that US policymakers have pushed for TSMC to produce cutting-edge nodes and advanced packaging domestically, aiming to reduce America’s reliance on offshore manufacturing. They warn that without TSMC’s presence in Taiwan, the island’s strategic importance to Washington could diminish significantly.
The concern extends beyond business logistics into geopolitical stability, particularly given the delicate relationship between Taiwan, the US, and China. With semiconductors being a critical industry for both national security and global supply chains, TSMC’s moves are under heavy scrutiny.
TSMC’s largest customers - NVIDIA, Apple, Broadcom, and AMD - are primarily American companies, all of which depend on access to cutting-edge semiconductor nodes. Under the Trump administration, the US government emphasized reshoring manufacturing and reducing dependency on Asia, leveraging tariffs and trade policies to push companies toward US-based production.
As a result, TSMC has invested tens of billions of dollars in US fabs, positioning itself as a central player in America’s tech manufacturing strategy. Industry experts see this as part of a larger shift from East to West in semiconductor production capacity.
Taiwan Still Holds the Core
Despite these expansions abroad, TSMC continues to keep its core technology and R&D operations in Taiwan. Several points reinforce this:
Advanced node R&D, such as work on the N2 process, remains centered in Taiwan.
The most advanced production lines for leading-edge chips are still located in Taiwanese fabs.
The company’s top engineering talent and critical intellectual property remain homegrown, ensuring Taiwan retains a strategic advantage in the semiconductor ecosystem.
This approach suggests that while TSMC is diversifying to satisfy US strategic and industrial demands, the “recipes” for the world’s most advanced chips remain firmly under Taiwan’s control.
TSMC’s dual strategy - expanding manufacturing to the US while keeping R&D and the most advanced production in Taiwan - highlights the firm’s balancing act between global geopolitical pressures and national economic security.
While the poll results reveal local unease about a potential shift in identity, the company’s core commitments to Taiwan indicate that the island will continue to be the epicenter of semiconductor innovation for the foreseeable future.
Do you think TSMC can maintain this balance, or will geopolitical pressure eventually force more of its cutting-edge work out of Taiwan?
