Phoenix, Arizona, often associated with golf courses, spring training, and scorching heat, has quietly emerged as an unexpected hub for technological innovation. The city has spent several decades developing into a major center, particularly for semiconductor manufacturing, testing self-driving cars, and drone technology.
“If we look at cities that really do end up becoming these, important technology hubs, there are four key elements,” says Anne Hoecker, Bain Global’s global head of technology. “The first is a favorable business environment. The second is an ecosystem of other companies. The third is proximity to a university with a strong engineering program. And finally, there’s the availability of talent.”
Technology companies have been drawn to Phoenix because it offers these advantages.
Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing Company (TSMC), a leading producer of advanced chips, is a significant example. TSMC has committed to investing $65 billion in the greater Phoenix area. The company and Greater Phoenix Economic Council spent three years conceptualizing a science and technology park to meet TSMC’s needs in order to secure the bid. This project, once complete, is expected to generate approximately 62,000 jobs, including those directly at TSMC.
Rick Cassidy, chairman of TSMC Arizona, noted that the company is “basically duplicating the science park concept that was pioneered in Taiwan,” which helps smaller suppliers by allowing them access to space and utilities.
Autonomous Vehicles
Self-driving car development is another key aspect of Phoenix’s tech scene. Companies such as Uber, Cruise, and Alphabet’s Waymo have been testing autonomous vehicles in the city. Hoecker of Bain notes that Phoenix’s grid-like street system and consistent weather make it an “optimal” place to conduct tests.
Arizona’s policies have also helped. Former Governor Doug Ducey enacted executive orders to lower barriers for autonomous testing. Waymo began testing in Phoenix in 2017 and is now a leading player in the market, operating its robotaxi service across 315 square miles of the city.
Drone Technology
Drones represent another area of technological advancement in the city. Amazon received regulatory approval in November to launch its Prime Air drone program in Tolleson, a suburb of Phoenix. The company hopes to scale the program, aiming for 500 million deliveries annually. Amazon reports that thousands of packages have already been delivered.
David Carbon, vice president and general manager of Amazon Prime Air, said, “It’s about scaling around the U.S. and around the world,” while indicating further expansion in 2025.
