TSMC’s first semiconductor factory in the European Union, located in Germany, will begin operations in 2027.
This project could represent a significant boost for the European semiconductor industry, according to Wu Cheng-wen, minister of Taiwan’s National Science and Technology Council, who mentioned that TSMC intends to further expand its activity in Europe.
In August, TSMC started building a semiconductor plant in Dresden, Germany, with an investment of €10 billion. Half of this investment will be financed by the German government, contributing €5 billion in state subsidies under the EU Chips Act.
The factory will produce chips for applications in industrial and automotive sectors. The project is a collaboration between TSMC, Dutch company NXP, and German firms Bosch and Infineon.
“They have already started constructing the first plant in Dresden, and they are planning future factories to target other market sectors,” Cheng-wen said in an interview with Bloomberg TV.
The minister added that TSMC’s expansion in Germany or other European countries will depend on the company’s market strategy.
“And when they decide to do so, our government will support them in establishing joint research collaborations, allowing them to continue developing innovative technologies,” Wu explained.
TSMC, in a statement to Bloomberg, said that at present, it has no new investment plans, as it is focused on its ongoing global expansion projects.
The importance of foreign investment in the European semiconductor sector
Currently, Europe produces about 10% of the world’s semiconductors, with a particular focus on chips for the automotive and industrial industries. Key players like NXP, Infineon, and STMicroelectronics play a significant role in this market.
The new TSMC plant will help strengthen the European Union’s position in these sectors. It is expected that by 2029, the factory will have an annual production capacity of 480,000 silicon wafers.
However, Europe is falling behind in the production of advanced chips, which are critical for emerging technologies like artificial intelligence and high-performance computing.
Intel’s project to build a megafactory in Germany, valued at €30 billion and set to begin operations in 2028, would have helped bridge this gap.
TSMC’s potential expansion in Europe offers a glimmer of hope. “The most important market for this expansion would be artificial intelligence,” Wu commented.
By: Nestor Castillo, ForAllTechNews Director