The Taiwan Semiconductor Manufacturing Co. (TSMC) announced Wednesday (August 9) they would be making next-generation 2-nanometer semiconductor chips at its newest plant in Kaohsiung once it was completed.
A company spokesman told local media the start date of mass production has yet to be decided, but they would be starting their test run in their Hsinchu county factory by 2025.
The 2nm chips TSMC planned to produce could achieve processing speeds 10% to 15% faster than 3nm chips, which are currently the most advanced in the market. Production of such chips would be crucial as it would be expected to have strong demand from fields such as artificial intelligence, Nikkei Asia reported.
TSMC also decided Tuesday (August 8) they would allocate roughly $6 billion for capital investments in Taiwan, including the construction of its Kaohsiung facility.
TSMC holds a roughly 90% market share in advanced semiconductors, all of which it produces in Taiwan. It had intended to produce older legacy semiconductors in Kaohsiung but considered a change in plans after the demand for computer chips started flagging in late 2022.
A third facility in Taichung was also slated to fulfill the production of 2nm chips in the future.
"We will need to make adjustments to the supply of water and electricity given TSMC's updated plans," Kaohsiung Mayor Chen Chi-mai told reporters Wednesday. "We will work closely with TSMC to ensure construction goes smoothly."
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TSMC Expands to Dresden
Meanwhile, TSMC earlier announced they would be teaming up with three European technology firms to build a chip-making facility in eastern Germany as part of its efforts to diversify its production locations and markets.
The company said they would invest €3.5 billion ($3.8 billion) and own 70% of the joint venture in Dresden. The Germany-based Robert Bosch and Infineon Technologies, and Dutch firm NXP Semiconductors would each contribute 10% of the shares, according to a New York Times report.
TSMC's Dresden plant, which would begin construction by 2024 and chip production by 2027, would be its first location in Europe, which would be an advantage for Germany, which has been seeking out manufacturers of microchips to support its large automotive industry, as well as for building other devices.
"This investment in Dresden demonstrates TSMC's commitment to serving our customers' strategic capacity and technology needs," TSMC CEO C.C. Wei said in a statement.
Meanwhile, German Chancellor Olaf Scholz said having TSMC in the country would make it become "the major location for semiconductor production in Europe."
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