Chip maker TSMC plans to build $2.9bn facility in Taiwan

Progress on construction at TSMC’s fab in Arizona (Image: TSMC)

Chinese chip manufacturer TSMC plans to invest nearly T$90 billion (US$2.87 billion) in the construction an advanced packaging facility in northern Taiwan.

“To meet market needs, TSMC is planning to establish an advanced packaging fab in the Tongluo Science Park,” the company said in a statement reported by Reuters.

CEO C.C. Wei said last week that TSMC is unable to fulfil customer demand driven by the AI boom and plans to roughly double its capacity for advanced packaging - which involves placing multiple chips into a single device, lowering the added cost of more powerful computing.

For advanced packaging, especially TSMC’s chip on wafer on substrate (CoWoS), capacity is “very tight,” Wei said after the company reported a 23% fall in second-quarter profit.

“We are increasing our capacity as quickly as possible. We expect this tightening will be released next year, probably towards the end of next year.”

The Tongluo Science Park administration has officially approved TSMC’s application to lease land, the company said, adding the new plant in the northern county of Miaoli would create about 1,500 jobs.