MediaTek Considers Major US Chip Production Deal With TSMC To Counter Tariffs

Let it never be said that tariffs don't work. In a bid to avoid tariffs and satisfy customer requirements for "made in the USA" parts, MediaTek is purportedly pondering a deal with TSMC to have some of its chips created in TSMC's fabs right here in the US of A. This news comes to us from Nikkei Asia, who reports that the $74.3B chipmaker hasn't finalized anything, but is seriously considering the idea of American-made MediaTek chips.

The publication quotes Corporate Vice President JC Hsu as saying that Mediatek is "preparing to potentially put some of our chips into production in Arizona later," such as "certain automotive chips or those used in more sensitive applications." The US Government has strict rules concerning the national origin of products and parts that it purchases, largely codified by the 1933 Buy American Act and the 1979 Trade Agreements Act.

Despite that MediaTek is a considerably smaller company than even the beleaguered Intel (to say nothing of Qualcomm, AMD, Apple, and NVIDIA, all of whom are larger), the firm is apparently among the many names vying for first-run 2nm capacity at TSMC for its next-generation Dimensity SoC. The company just launched its Dimensity 9500, sporting an all-big-core design that the company says offers radically improved efficiency.


Notably, MediaTek is the largest chipmaker outside of the US, and this would be the first time for a foreign chip developer to bring its operations to the US. It's a striking idea; usually companies are trying to pull operations out of the US rather than vice-versa. Chips made in the USA will be more expensive to make than those fabricated in Taiwan, but they might end up cheaper (at least, here in the US) due to tariffs and other costs.

However, it doesn't sound like MediaTek is planning to build high-end chips like the Dimensity series over here. The remarks from MediaTek's Hsu sound more like he's talking about lightweight embedded chips for automotive, industrial, or defense use. At least some of TSMC's capacity in Arizona is indeed earmarked for its N2 process, though, so we very well might see "Made in USA" Dimensity SoCs before long.

_{Top image: TSMC's Fab 21 in Arizona. Image: TSMC}