Taiwan Semiconductor Manufacturing Co. said it will accelerate work on its second Arizona fabrication plant, reflecting growing demand from major U.S. customers and continued pressure to diversify chip supply chains.

The company’s move comes as Washington pushes to increase domestic semiconductor output and tighten export restrictions on advanced chips bound for China. The policy shift has made U.S. production capacity more strategically important for companies such as NVIDIA, which rely on high-end chips for artificial intelligence systems and data centers.

TSMC has spent years expanding its manufacturing footprint beyond Taiwan, but the Arizona project remains one of its most closely watched overseas investments. Faster construction could help ease bottlenecks for American buyers, even as the industry continues to weigh costs, labor challenges, and the complexity of building leading-edge facilities outside Asia.

The expansion also underscores a wider realignment in global chip production, with governments and tech companies racing to secure supply amid geopolitical tensions and export controls. For U.S. customers, more domestic output may improve resilience; for Taiwan, it reflects the growing challenge of balancing industrial strategy with strategic risk.