Taipei, Oct. 4 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC) and U.S.-based Amkor Technology, Inc. have signed a memorandum of understanding (MOU) on collaborating to bring advanced packaging and test capabilities to Arizona, the companies said Friday.

Under the agreement, TSMC will contract turnkey advanced packaging and test services from Amkor's planned facility in Peoria, Arizona, to support its customers, particularly those utilizing its advanced wafer fabrication facilities in Phoenix.

"The close collaboration and proximity of TSMC's front-end fab and Amkor's back-end facility will accelerate overall product cycle times," the companies said in a joint press release.

The agreement also reflects a commitment to foster the development of a semiconductor manufacturing ecosystem in the United States and support customers who want to geographically diversify their supply chain in front-end and back-end manufacturing, the statement said.

Kevin Zhang (張曉強), TSMC's senior vice president for business development and global sales, said the partnership will support customers with a more diverse manufacturing footprint because they "depend on advanced packaging technologies for their breakthroughs."

"This expanded partnership underscores our commitment to driving innovation and advancing semiconductor technology while ensuring resilient supply chains," said Giel Rutten, Amkor's president and chief executive officer.

Liu Pei-chen (劉佩真), a researcher at Taiwan Industry Economics Services, a databanks of the Taiwan Institute for Economic Research, told CNA that the latest move is expected to positively reinforce TSMC's "Made in America" initiative.

In addition, she said, the partnership will help stabilize local factory orders, improve facility availability, and expand the company's AI customer base.

TSMC is building two advanced fabs in Arizona, with the first scheduled to start mass production in the first half of 2025 using the sophisticated 4 nanometer process.

The second is slated to mass produce wafers using the 3nm and 2nm processes in 2028 to tap into solid demand for artificial intelligence applications.

The 3nm process is currently the most advanced technology in mass production at TSMC.

TSMC has also announced a plan to build a third fab in Arizona using the 2nm process or more advanced technology, with production slated to start by the end of 2030. The third project would boost its total investment in Arizona to more than US$65 billion.

According to TSMC, like all of its advanced fabs, the three facilities in Arizona will have a cleanroom area approximately double the size of an industry standard logic fab.