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TSMC to Build World’s Largest Chip Fab in Germany

Science and Technology

Geopolitical Investing Strategy in the Netherlands

Business Honor
15 October, 2024

TSMC's ambitious investment aims to bolster its global presence amid growing demand for advanced chips.

Taiwan Semiconductor Manufacturing Co. will build its biggest fab globally in Dresden, Germany, which will cost 8 billion euros or about $10.9 billion. The fab, also known as the super fab, has already started being constructed, National Science and Technology Council Minister, Wu Cheng-wen, was quoted saying in an interview with Bloomberg TV. According to Wu, TSMC is planning to build more fabs that would service different sectors of the market.

The world's largest chipmaker, TSMC, is investing in factories around the US, Japan and Europe, motivated by growing demand for advanced chips to mitigate geopolitical risks, especially with China. The Dresden facility is expected to be up and running by the end of 2027, with about 50 percent of the financing coming from state subsidies.

Wu Cheng-wen, hinted at cooperation with future European chip design companies, such as Germany-based Black Semiconductor and the Netherlands-based Axelera AI, a part of his long-term strategy for the European Union. Still, he conceded that immediate outlooks for Taiwanese firms are not devoid of hurdles, such as rising costs from offshoring. However, he believes that this shift will prove beneficial to the company in the long run through integration into its systems. This may further strengthen the bonds between Taiwan and the Czech Republic and open up new avenues for TSMC's deeper penetration into the European market.