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Lora Ho, senior vice president responsible for sales, told reporters on the sidelines of a technology forum in Taipei that talks had begun with the German government but that a final decision would depend on government subsidies, customer demand and the talent pool. The Taiwanese chipmaker has yet to discuss incentives with German authorities, or decide upon a location, according to Ho.

In July TSMC chairman Mark Liu said TSMC was in discussions with customers over setting up a wafer fab in Germany. A move into Germany and Japan are a transition from a policy to focus the majority of its production on a few sites in Taiwan. TSMC has built fabs in the US (Wafertech) and in China in the past. And it has now committed to building a major chip facility in Arizona.

TSMC has started to extend its manufacturing footprint in response to various major countries seeking to increase domestic semiconductor production out of national security and self-sufficiency concerns. However, the cost of production is likely to be considerably more in Europe than in Asia and so TSMC will be seeking a high-level of financial support.

Chipmaker and would-be foundry Intel is expected to announce location for a wafer fab in Europe – either in Bavaria, Germany, or Galway, Ireland – before the end of the year.

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