Report: TSMC mulls plans for Dresden fab

Report: TSMC mulls plans for Dresden fab

Business news |
By Christoph Hammerschmidt

The semiconductor manufacturer TSMC plans to establish a branch in Germany’s “Silicon Saxony”. There, the Taiwanese company wants to produce SoCs for customers from the automotive industry.

This is according to the German online tech magazine Golem, who in turn is citing a report from Nikkei Asia.

The project has not yet been decided, but negotiations are already at an advanced stage. TSMC’s negotiating partners are important suppliers to the automotive industry.

The establishment of a TSMC subsidiary in Dresden, arguably the most important location for semiconductor technology in Europe, would enable the Asian company to benefit from the boom in demand for chips in the automotive industry. Since the beginning of the Corona crisis, the auto industry has been suffering from a massive chip shortage; there is no end in sight.

As Golem reports, TSMC is also currently looking for partners who can supply a chip factory with the necessary raw materials and feedstock. According to a supplier, it is also important that the state subsidizes any construction with financial aid. This is because the prices for energy have risen massively due to the Ukraine war, which nullifies earlier cost calculations. It is therefore possible that TSMC will withdraw its plans.

According to Nikkei Asia, TSMC plans to send a team of senior executives to Germany early next year to discuss the level of government support for the prospective plant as well as the capacity of the local supply chain to meet its needs, according to people familiar with the matter.

The trip will be the second in six months by TSMC executives and a final decision on whether to invest billions of dollars in a plant, which could begin construction as early as 2024, is expected to follow soon after. Such a fab would focus on the 22nm and 28nm chip technologies currently prevailing in automotive electronics designs. TSMCs technology for the potential fab in Dresden would be similar to what the company is currently developing together with Sony.

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Lack of chips continues to slow down auto industry


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