Phoenix has a new plant that will supply chemicals for semiconductors

Arizona's status as a semiconductor hub deepened Wednesday with the unveiling of a $100 million chemical plant by Taiwan's leading supplier to the industry.

Sunlit Flou & Chemical Co., also operating as Sunlit Arizona, unveiled the new manufacturing facility in north Phoenix at a ceremony attended by Gov. Katie Hobbs, Phoenix Mayor Kate Gallego and roughly 200 others.

The plant marks the latest development to round out Arizona's semiconductor ecosystem following the 2020 decision by Taiwan Semiconductor Manufacturing Co., after years of courtship, to invest $65 billion in a chipmaking factory roughly eight miles to the northwest of the new Sunlit facility.

Anchored by TSMC, Arizona since 2020 has landed more than 40 semiconductor-related commitments encompassing $102 billion in investments and 16,000 direct jobs, said Hobbs. "It is contributing to our already booming economy," she said.

TSMC, which generated a $10 billion profit in its latest quarter, expects to begin commercial production early next year of the tiny electronic devices found in all sorts of modern consumer and industrial equipment, from cell phones and computers to medical machinery and military systems.

Sunlit's investment underscores Metro Phoenix as "the place to be in the United States for advanced manufacturing," said Chris Camacho, president and CEO of the Greater Phoenix Economic Council.

Sunlit's 900,000-square-foot chemical plant features a maze of tanks, pipes, valves, pumps and other equipment. It sits on 27 acres near the flight path of Phoenix Deer Valley Airport.

TSMC will be Sunlit's main customer once the latter starts the commercial production of chemicals around early December.

Sunlit produces hydrofluoric acid, used to make chips and other chemicals. The company plans to ship chemicals across the United States. Hydrofluoric acid is used to etch or remove unneeded material to create the desired electrical patterns on semiconductors.

Hydrofluoric acid is toxic and corrosive, with large tanks containing the chemical marked with warning labels and an eyewash rinse basin inside the plant, but Sunlit officials say they follow safety procedures rigorously. The company adheres to the highest level of environmental standards, added Doris Hsu, who as chairperson and CEO of Sino-American Silicon Products and GlobalWafers is a Sunlit customer.

Water used in Sunlit's chemical process goes through eight stages of filtration to achieve "ultra-pure" status, with Sunlit investing $10 million in a water-filtration system, said Madren Tarrance, the plant's manager. Wastewater similarly is treated. "We waste no water and recycle literally every ounce of water," he said during a tour of the facility.

Sunlit said it thoroughly treats airborne emissions as well.

TSMC has been a Sunlit customer for decades, and the chemical company looks forward to supplying other American chipmakers including Intel, Micron, Global Foundries and Texas Instruments, said Bryan Lin, president of the Sunlit Group, speaking in Chinese.

Lin said the company overcame various challenges at the Arizona site including language and work-culture barriers, dealing with local laws and regulations and meeting the sizable financial investment. Construction of the first phase of the complex took about two and a half years. The Phoenix site marks the beginning of the company's "journey in North America," said Lin.

The Sunlit complex near Pinnacle Peak Parkway and Seventh Avenue marks the company's first venture outside of Taiwan.

Sunlit was founded in 1972 as a company that imported chemicals into Taiwan. TSMC began operations in 1987 and has emerged as the most valuable corporation in East Asia, based on stock market worth or capitalization.

Like TSMC, Intel and many others, Sunlit has applied for federal funds under the CHIPS and Science Act, key legislation designed to rejuvenate America's semiconductor industry. Intel including its Chandler campus are in line for $8.5 billion in grants and TSMC could receive $6.6 billion under the legislation, with Arizona having more funded projects under the CHIPS Act than any other state so far.

The plant’s first phase will create around 50 local jobs by early 2025, with plans for employment to rise to around 100 people as production expands.

Sunlit was one of the first Taiwanese semiconductor suppliers to commit to Arizona, said Sandra Watson, president and CEO of the Arizona Commerce Authority.

Gallego said Sunlit is "joining an already strong supply chain in Phoenix that is creating great jobs and strengthening our local economy.”

Phoenix Councilwoman Anne O'Brien, who represents the district, said these and other investments are bringing in restaurants and stores, and she predicted the area will "thrive for generations to come."

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