Zinger Key Points
- Taiwan Semiconductor plans two new Kaohsiung fabs, boosting 2-nm chip production.
- The five Kaohsiung fabs could create 8,000 jobs by 2027.
- Get New Picks of the Market's Top Stocks
Contract chipmaker Taiwan Semiconductor Manufacturing Co TSM plans to build its fourth and fifth wafer fabs in Kaohsiung in 2025, accommodating advanced processes.
The two facilities, P4 and P5, are part of Taiwan Semiconductor’s program, which targets building five fabs in Kaohsiung, according to a Taipei Times report.
On Thursday, Taiwan Semiconductor Vice President Arthur Chuang told the TT that the five facilities could add 8,000 jobs.
Also Read: Super Micro and Nvidia Expand in Taiwan with Green Energy and AI Projects
The P4 and P5 fabs would be located next to the third fab, P3, and their construction will likely finish in 2027. Taiwan Semiconductor said its first fab in Kaohsiung, P1, will begin commercializing the advanced 2-nm process in 2025.
The 2-nm process would be faster than N3E, an updated variant of the 3-nm process, with higher density and lower power consumption.
The second fab, P2, would likely be completed in 2025. It would also use the 2-nm process, while construction of the third fab will likely finish in 2026.
At an investor conference, Taiwan Semiconductor Chair C.C. Wei flagged higher interest in its 2-nm process than the 3-nm process, prompting it to ramp in 2-nm production capacity.
Taiwan Semiconductor already has a 2-nm wafer plant in Baoshan, Hsinchu County, which will likely start commercialization in 2025.
The chipmaker’s commercialization of the A16 process is scheduled for the first half of 2026.
Despite intensifying geopolitical tensions, Taiwan Semiconductor remains committed to maintaining its advanced semiconductor technologies in its home country.
In September, President Joe Biden authorized $567 million in defense aid for Taiwan, enhancing its military strength amid growing tensions with China. The U.S. also approved a $228 million military sale to bolster Taiwan’s aircraft combat capabilities.
On Friday, Taiwan’s science ministry warned that funding for semiconductors and AI could be hit by 20 billion New Taiwan dollars ($609.11 million) for 2025 after opposition parties pitched for laws to slash economic and technology spending, Reuters reports.
The Ministry of Economic Affairs on Tuesday flagged repercussions on Taiwan’s collaboration with Micron Technology, Inc MU, Advanced Micro Devices, Inc AMD, and Nvidia Corp NVDA, which are also key Taiwan Semiconductor clients.
Investors can gain exposure to the semiconductor stocks through ProShares Ultra Semiconductors USD and Invesco PHLX Semiconductor ETF SOXQ.
Price Action: TSM stock is down 0.96% to $199.70 premarket at the last check on Monday.
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