According to a local report that references Miaoli county magistrate Hsu Yao-Chang’s Facebook page, TSMC is planning to spend NT$300 billion (about $10 billion) to build the IC packaging and testing plant.

The general plan to build a plant at Miaoli has been on TSMC’s roadmap since 2018 and in November 2019 the plan passed an environmental impact assessment, enabling the foundry to begin construction of the fab in 2020 as scheduled. The plant is scheduled to be completed in May 2021 with operations set to start in mid-2021, the reports state.

The sum of money, as yet unconfirmed by TSMC, is large for a packaging and test plant. It is likely that this represents a life-time spend for an advanced packaging technology facility. There is a reference to the development on a Miaoli County government page here.

“TSMC has not disclosed the investment amount and the schedule of the facility,” a TSMC spokeperson told eeNews Europe in response to an emailed request for information. The spokesperson also said: “The plan was first announced sometime late 2018 and got environmental assessment approval in Nov. 2019. We expected to start the construction after we get the license in June. We have also disclosed that the project is expected to bring 2500 jobs.”

Such a large outlay, it it comes to pass, would be consistent with the way in which the distinctions between “front-end” and “back-end” manufacturing are blurring at the leading-edge of digital IC manufacturing and with the use of chiplets. Chiplet-style manufacturing allows the most cost-effective manufacturing processes to be used for each circuit block and then assembles the ‘chiplets’ together, often on a passive or active silicon interposer, to create multi-die components.

TSMC already provides some IC packaging and testing services at plants in Taoyuan, Hsinchu, Taichung and Tainan. This is largely related to 3D packaging and multi-die component techniques such as CoWoS and InFO. For more conventional assembly and test TSMC’s customers can use independent service providers such as ASE, Amkor, Nanium, SPIL and JCET Group (see ASE dominates top 25 ranking of chip packagers).

But with its experience in CoWoS and InFO TSMC is an enthusiastic proponent of chiplet manufacturing and it provides an opportunity for the company to keep more of the added value in house.

Next: What Wei said

In May 2019 CC Wei, TSMC’s CEO, told financial analysts that he expected the company to begin ‘chiplet’ style production with its System-on-Integrated Circuit (SoIC) 3D packaging system in 2021 (see TSMC preps for ‘chiplet’ style manufacturing in 2021). This would be consistent with the expected opening up of the Miaoli facility. At the time Wei said that the packaging style was being well received in the mobile and high-performance computing sectors and that his company has an inquiry from an automotive chip company.

The SoIC manufacturing/packaging approach is supported by EDA software supplier Cadence Design Systems Inc. and is said to be suitable for 5G, AI, IoT and automotive applications.

Another piece of evidence pointing to a major investment in Miaoli is that on May 12 TSMC’s board of directors approved capital appropriations of approximately NT$168.3 billion (about US$5.6 billion).

The purposes for this money included: 1) fab construction and installation of fab facility systems; 2) Installation and upgrade of advanced technology capacity; 3) Installation of specialty technology capacity; 4) Third quarter 2020 R&D capital investments and sustaining capital expenditures.

This large amount of spending would be consistent with a more aggressive move into advanced packaging in support of chiplet-style manufacturing.

Related links and articles:

News articles:

ASE dominates top 25 ranking of chip packagers

TSMC preps for ‘chiplet’ style manufacturing in 2021

Birth of chiplet market shows more than 40% annual growth

Achronix, Facebook, NXP working hard for a chiplet future

TSMC dragged to the altar of US manufacturing

TSMC picks Arizona for 5nm wafer fab

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