TSMC in early-stage contact with Germany about potential plant

TAIPEI: Taiwan Semiconductor Manufacturing Co (TSMC) is in early talks with the German government about potentially establishing a plant in the European country, a senior executive said.

Various factors including government subsidies, customer demand and the talent pool will influence TSMC’s final decision, senior vice-president of Europe and Asia sales, Lora Ho told reporters on the sidelines of a technology forum in Taipei.

The discussions come as the European Union and others seek to increase domestic chip production to mitigate future supply chain disruptions. The Taiwanese chipmaker hasn’t discussed incentives with Berlin or decided on a location, Ho said.

TSMC chairman Mark Liu told shareholders in June that the chipmaker had begun assessments on setting up manufacturing operations in the European country.

The world’s largest contract chipmaker, whose production sites are mostly in Taiwan, has started to diversify over the past year to help meet demand in various major countries seeking to bolster domestic semiconductor production out of national security and self-sufficiency concerns.

It’s now building a US$12bil (RM50.55bil) facility in Arizona, and will soon start construction of a US$7bil (RM29.49bil) plant in Japan.

Meanwhile, the EU will unveil its European Chips Act in the first half of next year as part of its strategy to boost semiconductor production. One of the goals will be to account for 20% of global production by 2030