The world’s largest foundry Taiwan Semiconductor Manufacturing Co. (TSMC) has plans to build a 6 nm and 7 nm chip fab in the Taiwanese city of Kaohsiung.
According to Nikkei, the new fab will be used for mobile, computing and graphics processors as TSMC makes chips for AMD, Nvidia and MediaTek. Construction on the facility will begin next year, but it is not expected to begin production until 2023 or 2024.
The Kaohsiung fab will help to fill the demand for chips that is expected to increase 5% over the next decade due to an increase in the use of chips in industries such as automotive, consumer electronics, internet of things, industrial and more.
The fab will be the first time TSMC will have a presence in Kaohsiung, an industrial harbor town.
According to the report, the move will continue TSMC’s ramp up of building semiconductor factories to meet the current and future demand from chipmakers. TSMC said earlier this year it plans to invest some $100 billion over the next three years on growing its capacity.
Currently, TSMC’s most advanced chip production is the 5 nm technology used to build mobile processors for Apple’s iPhone 12 and upcoming iPhone 13. However, TSMC also manufactures chips for Intel Corp.
TSMC’s fab in Taichung is its critical 7 nm production facility and the company continues to add equipment to it. However, according to the report, it is almost out of space, thereby making it necessary for more capacity at this processing node to be developed.
The move to increase chip capacity is something happening on a global scale and has been exacerbated by the chip shortage that has crippled many segments of the supply chain in 2021. This has caused lawmakers, companies and organizations to look to increase domestic chip manufacturing to decrease the reliance on foreign companies as well as if geopolitical issues continue to be a problem or in the event of a future pandemic or emergency.
Intel is championing a return to U.S. domestic semiconductor manufacturing, investing $20 billion in two new fabs in Arizona as well as developing its own foundry business to compete with the likes of TSMC, UMC and GlobalFoundries.
Intel wants one-third of all production of semiconductors to be done in the U.S. in the future. Currently, only 12% of all chips made worldwide are manufactured in the U.S. Meanwhile, the European Union is mobilizing its own plans to gear up investments with the goal to manufacture 20% of the world’s chips by 2030.