Taiwan Chipmaker TSMC Nods USD 3.8 Billion Germany Factory Plan
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Taiwan Chipmaker TSMC Nods USD 3.8 Billion Germany Factory Plan

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Taiwan Semiconductor Manufacturing Co. (TSMC) announced that its board has approved an investment of $3.8 billion (3.5 billion euros) for the development of its first European factory, to be located in Germany. The largest contract chip manufacturer in the world, TSMC, has been in discussions with the German state of Saxony about constructing a manufacturing facility, or "fab," near Dresden since 2021.

Following a board meeting, the business issued a brief statement announcing that it had approved an investment of up to 3.499 billion euros in a subsidiary of TSMC with a controlling stake in Germany called European Semiconductor Manufacturing Company (ESMC) GmbH for the purpose of providing foundry services. In an effort to catch up with Asia and the United States, the European Union has passed the EU Chips Act, a 43 billion euro subsidy plan to treble its chipmaking capacity by 2030.

Along with Intel and Wolfspeed, TSMC is one of several chipmakers looking to use government subsidies to establish plants in Europe. By paying billions in state subsidies, Brussels and EU member states are encouraging domestic manufacture in an effort to reduce reliance on Asian suppliers and alleviate a global chip shortage that has caused major problems for the auto industry.

By 2030, the bloc wants to have a 20% market share worldwide. In order to support Washington's goals for more domestic chip production, TSMC is also investing $40 billion in a new facility in the western American state of Arizona.

As part of the overall $40 billion investment, TSMC said in a statement following the board meeting that it had also approved a capital infusion of no more than $4.5 billion for the Arizona factory.

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