Technology may not be the first thing that comes to mind when you think of Phoenix. The city is best known for its golf courses, Major League Baseball spring training, retirement appeal, and scorching heat.
But its growth as an innovation hub has been quietly underway for decades. Arizona’s largest city has become a hub for semiconductor manufacturing and testing of self-driving cars and drones for a variety of reasons.
“When you look at cities that are actually important technology hubs, there are actually four things that we typically see, and Phoenix actually does all of those things,” said John, global head of technology. said Anne Hocker. Bain Global. “First is the favorable business environment. Second is the ecosystem of other companies. Second is the close proximity to universities with strong engineering programs. And finally, the availability of talent. .”
Tech companies are flocking to the city to take advantage of these perks. Taiwan semiconductor manufacturing companyTSMC is one of the largest.
TSMC makes some of the most advanced chips in the world and has committed to investing $65 billion in the greater Phoenix area. The chipmaker first held discussions with the city of Phoenix in 2016 when it was looking to expand its advanced chip manufacturing beyond Taiwan. To secure the bid, the Greater Phoenix Economic Council spent three years developing a vision for a science and technology park that would meet the company’s needs. Once completed, the project is expected to create approximately 62,000 jobs in the surrounding area, including TSMC.
“They’re basically replicating the science park concept that they pioneered in Taiwan,” said Rick Cassidy, chairman of TSMC Arizona. “This solves a lot of problems for small suppliers. They just need to actually rent space and connect.”
Self-driving cars are another feature of the city’s tech scene. Uber,cruise, alphabetWaymo tested self-driving cars all in the city. Bain’s Hocker said Phoenix’s infrastructure, with its grid of roads and stable weather, made it the “perfect” place to deploy them.
Arizona policy has welcomed self-driving technology. Former Arizona Governor Doug Ducey enacted several executive orders to reduce barriers to voluntary testing. Waymo began testing in Phoenix in 2017 and is the largest player in the market. The company’s robotaxi service currently operates within 315 square miles of the city.
Drones are another technology that puts cities on the map. In November, Amazon has received regulatory approval to launch its Prime Air drone program in the western Phoenix suburb of Tolleson. Amazon says the plan is to expand the program to 500 million deliveries per year. The company says it has delivered thousands of packages so far.
“This is about expanding across the U.S. and around the world,” said David Carbone, vice president and general manager of Amazon Prime Air, adding that more will happen in 2025. “This is just the beginning.”
Watch CNBC’s Kate Rooney take you behind the scenes at Amazon’s cutting-edge drone operations and explore how Phoenix became a technology hotspot.
