Taiwan Semiconductor Expands to Europe with $11B Chip Plant in Germany: Report

Taiwan Semiconductor Manufacturing Co TSM looks to break ground on its first European 12-inch plant in Dresden, Germany, worth 10 billion euros ($11 billion)  in partnership with Infineon Technologies AG IFNNF, NXP Semiconductors NV NXPI and Robert Bosch GmbH, Bloomberg reports.

The facility, with an initial monthly capacity of 40,000 wafers, plans to launch 28 nm or 22 nm planar CMOS (complementary metal-oxide-semiconductor) technology and 16 nm or 12 nm FinFET (fin field-effect transistor) processes, TechNode cites Economic Daily News.

In August 2023, Taiwan Semiconductor, Bosch, Infineon, and NXP Semiconductors formed the European Semiconductor Manufacturing Company (ESMC), with each firm holding a 10% stake.

Also Read: Taiwan Semiconductor Acquires Tainan Facility For $531M, Plans Major Expansion

The German plant will operate under ESMC and will likely start by late 2027.

Taiwan Semiconductor, a key supplier of Nvidia Corp NVDA, remains dedicated to its objective of supplying artificial intelligence chips, boosting its capital expenditure to $29.62 billion.

Meanwhile, separate reports indicate the semiconductor industry is battling multiple constraints, such as escalating geopolitical tensions between the U.S. and China, workforce shortage, and a groundwater crisis, as it expands its geographies beyond Taiwan.

Taiwan Semiconductor is amid attempts to preserve groundwater in Japan by flooding unused paddy fields to evade concerns surrounding its ambitious chip factories in Kumamoto prefecture, the Nikkei Asia reports.

Taiwan Semiconductor stock gained 90% in the last 12 months. Investors can gain exposure to the stock through SPDR MSCI ACWI ex-US ETF CWI and SPDR NYSE Technology ETF XNTK.

Price Action: TSM shares traded lower by 0.63% at $174.35 at the last check on Tuesday.

Photo by Ivan Marc via Shutterstock