TSMC accelerates its layout in Kaohsiung and expands investment in second nanometer fab

TSMC's layout in the global semiconductor industry is developing rapidly. In addition to new factories in Japan, the United States and Europe that will be put into production in the fourth quarter of this year, the company has also expanded its advanced process layout in Taiwan. After Hsinchu Baoshan, TSMC plans to build a third 2-nanometer wafer fab in Kaohsiung and will invest more than NT$2 trillion here.

Second nanometer technology is TSMC’s main development direction in Kaohsiung and Hsinchu Baoshan, and is expected to enter the mass production stage in 2025. Due to strong customer demand for 2-nanometer products and the promotion of AI technology and smartphone applications, Kaohsiung’s investment plan has expanded from the original two wafer fabs to three.

TSMC’s Kaohsiung new factory plan announced in November 2021 is progressing smoothly, and the infrastructure has been built. Taking into account the strong demand for N2 process products, the company plans to further develop the third phase of the factory based on the existing basis. At the same time, TSMC’s three-nanometer factories in Tainan and Taichung are also actively under construction, demonstrating deep investment in the Taiwan market.

Company President Wei Zhejia analyzed that customer demand is strong, and even though TSMC expects to double its advanced packaging production capacity after 2024, supply may still exceed demand by 2025. TSMC has more than a decade of experience in advanced packaging and is expected to have a compound annual growth rate of at least 50% in the next few years.

Chairman Liu Deyin mentioned that the first factory in Kumamoto, Japan, is scheduled to start construction on February 24, and will begin mass production of mature process products in the fourth quarter of this year; the evaluation of the second factory has been completed and is expected to start construction this year. The Arizona factory in the United States will produce four-nanometer products and is expected to be mass-produced in the second half of 2025; the second factory is also under construction, and the final manufacturing process will be determined based on the progress of U.S. government subsidies.

In Europe, TSMC is working with its partners to establish a special process fab in Dresden, Germany, focusing on automotive and industrial applications, and is maintaining close communication with German governments at all levels. The company plans to start construction in the fourth quarter of this year.

The Kaohsiung City Government stated that it will fully support TSMC to ensure mass production of advanced processes as scheduled and meet market demand. At the same time, the city government is assisting TSMC in planning its third wafer fab and cooperating with market demand and the planning process. The Gao City Government also emphasized that it will cooperate with TSMC and the Nanjing Administration of Science and Technology to support TSMC’s expansion of investment, including water and electricity needs, to ensure that TSMC’s 100% recycled water production needs are met.