【By Observer Net, Chen Sijia】According to a report by the U.S. "Wall Street Journal" on July 4, due to concerns over Trump's tariff policies, TSMC may delay the construction of its second factory in Japan and prioritize expanding its investments in the United States. Analysts believe that this news is a blow to Japan and reflects how Trump is using the interests of allies to attract investment into the United States.

TSMC's first factory in Japan has been operational since last autumn, producing chips for clients such as Toyota. TSMC announced last year that it would build a second factory in Kumamoto Prefecture in southern Japan, which is part of its $2 billion investment plan in Japan, with the Japanese government committing to provide over $8 billion in support.

In June this year, TSMC Chairman Wei Chao-chi said that due to "heavy traffic" locally, the construction of the second factory might be "slightly delayed." However, multiple sources told the "Wall Street Journal" that due to concerns about the Trump administration's tariff policies, the start of the second factory could be further postponed, with no accurate prediction for the specific time.

The first factory built by TSMC in Kumamoto, Japan. Visual China

Trump's 25% tariffs on cars and auto parts have severely hit Japan's export-oriented economy, which is centered around the automotive industry. Japan hopes to reach a trade agreement with the United States as soon as possible, but negotiations have stalled. If an agreement is not reached before the deadline of July 9 for the U.S. to raise tariffs, Japan will face a 24% tariff.

A Japanese government representative told the "Wall Street Journal" that the Japanese government has not yet directly received from TSMC an explanation that traffic conditions are causing the construction to be delayed, nor does it consider this to be the reason for the delay. The representative stated that although there has been a delay in the start of the project, the Japanese side believes that the completion date and planned production volume of the second factory will remain largely unchanged.

Analysts say that at a time when Japan is facing pressure from Trump's tariffs, TSMC's decision to delay the construction is undoubtedly a blow to Japan. TSMC is known for its cautious spending, worrying about building capacity beyond market demand, but with Trump threatening to impose tariffs on imported chips into the U.S., ensuring U.S. capacity has become the company's top priority.

TSMC's customers include tech giants like Apple and NVIDIA, who are working to expand globally. In addition to Japan, TSMC has already started construction of its first European factory in Germany at the end of last year, aiming to be operational by the end of 2027.

In the U.S., TSMC's investment is even larger. It has previously announced an investment of $65 billion. In March this year, Wei visited the White House and announced with Trump that they would add at least another $10 billion in investment in the U.S. In April, U.S. Commerce Secretary Rutenberg also visited Arizona and attended the groundbreaking ceremony for the third chip factory of TSMC in the Phoenix area.

The factory located in Arizona, U.S., is the only one planned by TSMC outside of Taiwan to produce the most advanced process chips, supplying chips to American tech giants such as Apple, NVIDIA, and AMD. The "Wall Street Journal" said this aligns with the U.S. government's policy to promote the development of the domestic semiconductor manufacturing industry.

The Trump administration hopes to bring semiconductor manufacturing back to the U.S., and has already launched investigations into tariffs on pharmaceuticals and semiconductors in April this year. According to Bloomberg News in the U.S., Trump had previously threatened to impose a 25% tariff on semiconductors, but this was generally opposed by business leaders including Tesla, General Motors, and Ford. The industry is concerned that semiconductor tariffs could disrupt supply chains and increase costs.

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