Report: TSMC in talks to build Germany fab

14 December 2021

Taiwan Semiconductor Manufacturing Company (TSMC) is reportedly in talks to build a new semiconductor manufacturing fab in Germany.

According to ElectronicsWeekly, TSMC has yet to determine a location in Germany for the fab, but subsidies will be offered to TSMC to build the factory in the country.

The pure play foundry giant is currently building fabs in Arizona in the United States, where it recently broke ground on construction, and last month gave details regarding its new Japanese fab it is partnering with Sony Semiconductor to build.

The European Union (EU) has plans to increase its semiconductor manufacturing presence with the goal to supply 20% of the world’s chips by 2030. The move comes as the chip shortage in the supply chain is crippling parts of the electronics market and causing issues with companies getting enough supply to build devices.

Countries globally are looking to expand domestic presence for semiconductor manufacturing to avoid future geopolitical issues or future pandemics that may arise and cause future supply chain problems.

Other German fabs

Earlier this year, Germany was reportedly trying to woo Intel Corp., one of the largest chipmakers in the world, to build a new chip fab in the country and was in talks with the company to set the location in the state of Bavaria. Intel, too, would be looking to receive public subsides for the chip fab and the government of Bavaria suggested an unused airbase in Penzing-Landsberg, west of Munich, as a potential location for the factory.

Intel has been increasing its investment in semiconductor manufacturing, building two factories in Arizona and a new foundry service, and may invest some $100 billion on multiple chip factories and could build up to eight phases of fabs at one or more EU locations.

At the time, the move to build a factory in Bavaria garnered support from BMW, who called it an outstanding opportunity for automotive chip makers. However, BMW just signed an agreement this month with GlobalFoundries to build current and future semiconductors. GlobalFoundries also this year committed to expanding its output from its three factories including those in the U.S., Singapore and Germany.

Bosch opened its new chip fab in Dresden, Germany, this summer and plans to invest a total of $463 million in wafer fab expansion at the Dresden factory and Reutlingen, Germany, as well as a new semiconductor test factory in Penang, Malaysia.

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