TSMC to triple investment in its Arizona plant but it won't make Apple's best iPhone or Mac chips

Apple A16 chip
(Image credit: Apple)

TSMC, a key supplier for Apple and the maker of its iPhone and Mac chips, is reportedly ready to triple its investment into a new Arizona plant. But that plant won't be responsible for building Apple's very best chips.

With the Arizona plant set to cost TSMC around $40 billion following the increase, it's now reported that the company doesn't plan to build chips capable of powering Apple's very best iPhone or Mac devices. Instead, it will always be one step behind its Taiwanese plants.

Always one step behind

The news comes via an anonymous source speaking with the Financial Times with 9to5Mac picking it up. According to that source, "TSMC’s US presence will continue to follow the principle of N minus 1,” meaning that "any U.S. fab would be one technology generation behind the most advanced in production in Taiwan."

That would mean that even if TSMC is building 3nm chips for Apple's iPhones and Macs, or indeed any other future devices, the Arizona plant won't be doing it. Instead, that'll fall to existing facilities located in Taiwan, as is already the case.

Instead, it appears that TSMC will be using its Arizona factory to provide less high-0profile chips, possibly those that find their way into the Apple TV, Apple Watch, and AirPods.

The same FT report notes that this approach won't help Apple diversify its supply chain any further because, in reality, the company will still be beholden to the same factories and countries that were already in play before the building of a factory on U.S. soil.

This backs up a previous report which notes that the Arizona plant wouldn't have the raw capacity to be able to build enough chips to satisfy Apple's iPhone and Mac demand, even if it was to build its latest and greatest chips.

Oliver Haslam

Oliver Haslam has written about Apple and the wider technology business for more than a decade with bylines on How-To Geek, PC Mag, iDownloadBlog, and many more. He has also been published in print for Macworld, including cover stories. At iMore, Oliver is involved in daily news coverage and, not being short of opinions, has been known to 'explain' those thoughts in more detail, too.

Having grown up using PCs and spending far too much money on graphics card and flashy RAM, Oliver switched to the Mac with a G5 iMac and hasn't looked back. Since then he's seen the growth of the smartphone world, backed by iPhone, and new product categories come and go. Current expertise includes iOS, macOS, streaming services, and pretty much anything that has a battery or plugs into a wall. Oliver also covers mobile gaming for iMore, with Apple Arcade a particular focus. He's been gaming since the Atari 2600 days and still struggles to comprehend the fact he can play console quality titles on his pocket computer.