TSMC Plans Additional Plants In Europe, Official Says

Matthew Broersma,
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TSMC logo on a building. Image credit: TSMC

Taiwan official says TSMC planning additional plants in Europe to focus on AI market, after German factory breaks ground

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Taiwan Semiconductor Manufacturing Co (TSMC) is planning additional chip factories in Europe with a focus on artificial intelligence (AI) chips, an official from the country said.

“They have started construction of the first fab in Dresden, they are already planning the next few fabs in the future for different market sectors as well,” Taiwan’s national science and technology council minister Wu Cheng-wen told Bloomberg.

Wu did not specify a time frame for the company’s European plans.

TSMC has not acknowledged any plans in Europe apart from a plant in Dresden, its first factory in the EU, which broke ground in August.

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AI chips

In a statement TSMC said it remains focused on its current international expansion projects and has no new investment plans at this time.

Wu said the AI market, including producing chips for Nvidia and AMD, would be the most important for TSMC and that the company was also considering opportunities offered by alternative AI chips offered by other companies.

He said TSMC was evaluating whether to expand the Dresden plant or to move into other areas of the EU.

The German government pledged billions of euros to support the Dresden plant, with about half of the funding for the project covered by state subsidies.

TSMC itself said it was investing 3.5 billion euros (£2.9bn) into the plant, alongside other industrial partners, with the factory scheduled to start by the end of 2027.

Czech Republic

Wu said the Taiwanese government is considering support for TSMC suppliers to invest in a location in the Czech Republic at a location close to Dresden, which is capital of Germany’s eastern state of Saxony.

He said he is also seeking to facilitate joint research and development programmes for academics in the Czech Republic and Taiwan.

Several Taiwanese officials, including Wu, have travelled to the Czech Republic this year as the country deepens its trade ties with the island.

Wu said he expects pressure on Taiwanese chip firms to expand in the US will continue to grow regardless of the outcome of US elections next month.

He said expansion into the US was “painful” for Taiwanese firms because “it’s more expensive if they move over there”, but that in the long run “maybe it’s good for them, from my point of view, because they can improve themselves”.

US expansion

The US government in April announced a $6.6bn grant to TSMC to help fund a third manufacturing plant in Phoenix, Arizona that is intended to manufacture cutting-edge 2 nanometre chips by the end of the decade.

The US is making an additional $5bn loan available to TSMC as part of the deal, which sees the company’s total investment in its Arizona facilities rising to $65bn from a previous $40bn.