TSMC Expands U.S. Investment, Plans Up to 25 New Factories in Taiwan

Taiwan's UDN Reports, Citing Supply Chain Sources

It was reported on July 20 that TSMC, the world's largest foundry company, is planning to build up to 25 new factories in Taiwan over the next five years, regardless of its ongoing expansion of overseas investments in countries such as the United States and Japan.

Logo of Taiwan Semiconductor Manufacturing Company (TSMC). Photo by AP Yonhap News.

United Daily News (UDN) cited supply chain sources, reporting that TSMC is pursuing plans to construct new factories in key locations such as Kaohsiung Chiaotou, Tainan Special Planning Zone, the second phase of the Hsinchu Science Park, and the Taoyuan Longtan Science and Technology Park. It is known that government authorities have already confirmed the site plans for each region.

This strategy is interpreted as a move to not only expand advanced process production capacity, but also to further strengthen Taiwan's semiconductor ecosystem. The new factories are expected to incorporate advanced processes below 2 nanometers and will be established to respond to the global demand for high-performance semiconductors. In semiconductors, a nanometer (nm) is a unit that represents the width of circuit lines—the narrower the lines, the lower the power consumption and the faster the processing speed.

Taipei Times reported that, recently, concerns have resurfaced in Taiwan about the potential weakening of the nation's advanced semiconductor competitiveness due to TSMC's increasing overseas investments. This has led to anxieties over the potential collapse of the so-called 'silicon shield'—the belief that China would refrain from invading Taiwan because of its semiconductor chip supply capabilities.

These concerns were heightened especially after TSMC Chairman Mark Liu announced on the morning of July 17 that the company would invest an additional 100 billion dollars (approx. 148 trillion won) in Arizona, USA, to build at least four advanced wafer fabs for processes of 2 nanometers and above, as well as a cutting-edge packaging facility. This 100 billion dollar investment is separate from the previously announced 165 billion dollar (approx. 245 trillion won) investment plan. He explained that to meet demand for 3-nanometer chips, TSMC will additionally construct 3-nanometer plants in Taiwan, the US, and Japan, and some 5-nanometer production lines will be converted to 3-nanometer lines.

In response, the Taiwanese government has sought to calm the deteriorating public sentiment by reassuring that, even after TSMC’s additional investment in the United States, the most advanced technologies will remain in Taiwan. The Executive Yuan emphasized that Taiwan would continue to maintain its leading position by securing state-of-the-art technology, the largest manufacturing capacity, and a comprehensive tech industry ecosystem. It also said that it has established a government-to-government (G2G) communication mechanism with the United States, and explained that, even if the US imposes semiconductor tariffs under Section 232 of the Trade Expansion Act, Taiwanese companies will be granted preferential treatment.

This content was produced with the assistance of AI translation services.