Apple’s New Arizona Plant Won’t Be Capable of Making iPhone Chips at First

Planning for the future

  • The new TSMC factory in Arizona will come online in 2024. 
  • It will not be capable of making Apple’s planned iPhone and Mac chips.
  • This is about the future, and leaving China.
close up view of a the back of a computer chip

rioryan / Unsplash

Apple's chip-making partner TSMC is building a new plant in Arizona, but this doesn't mean Apple will make iPhones in the US. It won't even make iPhone chips. 

Tim Cook and President Joe Biden toured the site of TSMC's new Arizona plant, which will make chips for Apple, but not its M-series and A-series Mac and iPhone chips. The facility was completed earlier this year, and manufacturing is set to begin in 2024. But even though this facility isn't even online yet, and even though it cost $12 billion, it won't be advanced enough to make Apple's processors, which makes one wonder: why bother at all?

"In short, if that first fab comes online in 2024 (which is no sure thing […]), it will be, in the most generous interpretation, two years behind 4-nanometer production in Taiwan, and if we're being honest, four years behind the 5-nanometer generation that said factory will be producing," writes industry analyst Ben Thompson on his Stratechery blog


Apple Silicon is far ahead of the competition in terms of its incredible power and low power consumption. This is down to several factors, including the design (Apple’s chips are optimized to run only Apple software, which makes for much more powerful and efficient designs) and also the process used to make the chip.

Chip manufacturing is measured in nanometers. Or rather, the term nanometer (nm) is used to name successive generations of chip-making tech. For example, the current iPhone 14 models use chips made using the 5nm process. While nothing necessarily measures five nanometers on these chips, the components on 5nm chips are smaller than those on a 6nm chip. the future, a few generations down the line, there’s no reason the US TSMC plant shouldn’t be making the latest and smallest chips for Apple.

That’s important because smaller transistors mean faster processing and less power required to do it. Apple’s partnership with TSMC keeps it at the front of this race, and Apple is consistently using the latest chip nanometer process for its flagship chips. 

And the Arizona plant? There are several different, conflicting reports, but it appears the plant will use either a 5nm or 4nm process. That sounds good until we consider that by the time it comes online, Apple will almost certainly be using a 3nm process for its M- and A-series chips.

Which is to say, the Arizona plant won’t be making iPhone chips. Or not current ones, at least. It could instead make other chips for Apple’s devices, or it could make older A-series chips. Under Tim Cook, Apple tends to keep older devices on sale for years, enjoying the reduced cost of manufacturing. Also, Apple uses older A-series chips in all kinds of devices, from the Studio Display to the Apple TV. 

But why bother?

Made in the US

Apple plays a long game with its manufacturers. It has a history of massive investment in both infrastructure and training for its manufacturing partners. For example, when it started milling MacBooks from solid aluminum blocks, Apple invested in CNC lathes for its partners. So, while Apple technically uses third-party manufacturers to build its products, it has a very deep integration with these companies.

It's also cheaper to build outside the US. 

"There are a few key reasons why building high-precision electronics products in the United States, rather than China or India, may have drawbacks. First, the labor costs in China and India are generally much lower than in the United States," Jeroen van Gils, managing director at networking tech manufacturing company, told Lifewire via email. "Consequently, it can be much easier and cheaper to buy components from overseas and assemble a product using those parts. Second, there are often significant delays in getting new technology approved by regulators in China and India."

This is a macro of a silicon wafer. Each square is a chip with microscopic transistors and circuits.

Laura Ockel / Unsplash

Clearly, it makes little sense for Apple to help build a $12 billion chip fabrication plant in the US just to make chips for its monitors and Apple TV. But if we view this in terms of Apple’s slow attempts to minimize its reliance on China, everything becomes clear.

Right now, Apple cannot make enough iPhones, thanks to the effects of COVID, both directly and politically, in China. It’s also reliant on China as a large market for selling those finished iPhones. Apple is slowly helping its manufacturing partners build assembly plants in other countries like India, but pretty much all its Apple Silicon chips are made by TSMC. 

So, getting chip manufacturing out of Taiwan is a priority. The Arizona plant could be the first step towards this. Maybe right now, Apple won’t be making all its chips in the US, but in the future, a few generations down the line, there’s no reason the US TSMC plant shouldn’t be making the latest and smallest chips for Apple.

The US government also realizes the importance of bringing chip manufacturing back home, and who better to help with this than a company that has been pushing chip making forwards for years? Biden and Cook toured the Arizona facility together because its future is equally important to both of them.

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