A major shift in US chip policy is reportedly on the table, and it could create serious headwinds for TSMC and other global foundries. According to a report, the US government is considering a 1:1 manufacturing requirement that would force chipmakers to produce as many semiconductors in the United States as their customers import from overseas. Companies that fail to maintain that balance over time could face steep tariffs.
This marks an evolution from earlier tariff talk, which at one point floated rates as high as 100% before carving out exemptions for firms building in America. The newly discussed approach appears aimed squarely at reducing dependence on offshore production rather than offering blanket relief to companies with any US footprint.
For TSMC, the world’s leading foundry, the implications are significant. Its most advanced capacity and highest volumes are concentrated in Taiwan, while US production is still ramping. The disparity in both process technology and output between its Taiwanese mega-fabs and newer American sites makes a strict 1:1 ratio tough to hit in the near term. That said, TSMC has committed massive investment to US manufacturing and has signaled plans to bring cutting-edge nodes to American soil, indicating a clear intent to grow a meaningful domestic footprint.
The reported policy discussion also includes a relief period that would allow companies to keep sourcing chips from overseas while US facilities come online. Once that grace window closes, however, those that haven’t aligned domestic output with imports could be subject to tariffs—potentially reshaping sourcing decisions across the semiconductor industry.
Beyond wafer fabrication, the push appears to extend across the entire chip supply chain. Many advanced products rely on offshore assembly and advanced packaging services to reach final form. The emerging policy direction suggests a drive toward a fully onshore, end-to-end manufacturing flow—design, fabrication, packaging, and test—culminating in a 100% “Made in USA” semiconductor, even at the most sophisticated levels.
There’s also a geopolitical dimension. As TSMC deepens its US footprint, debate in Taiwan has intensified over whether the company is becoming too aligned with American manufacturing priorities. While core R&D remains anchored in Taiwan, a policy that encourages producing the same node technology in both countries could be perceived as accelerating technology transfer and diluting the island’s centrality in leading-edge production.
If implemented, a 1:1 requirement would ripple across the industry. Companies would need to weigh the costs of rapidly expanding US capacity against the risk of tariffs. Customers might face higher prices or extended lead times as supply chains are rebalanced. Suppliers supporting advanced packaging and materials could see increased incentives to localize in the United States. Meanwhile, the talent pipeline—engineers, technicians, and specialists—would become a critical bottleneck, influencing timelines for bringing advanced nodes to volume in America.
Key points to watch include how the relief period is structured, how “imports” are defined for complex multi-stage products, and whether exceptions or phased targets are offered for leading-edge nodes. Clarity on these details will determine how rapidly companies must move and how disruptive the transition could be for downstream industries like smartphones, data centers, AI accelerators, and automotive electronics.
Bottom line: the proposed shift would push chipmakers to match US production to overseas sourcing, accelerating onshoring far beyond current plans. For TSMC, it raises the stakes on building competitive, high-volume US fabs while maintaining leadership in Taiwan. For the broader market, it signals a major reshaping of semiconductor manufacturing strategy, with potential consequences for costs, capacity, and innovation over the next several years.
