Taiwan Semiconductor Strengthens Europe's Semiconductor Base

Taiwan Semiconductor Manufacturing Co’s TSM semiconductor fab construction in the German city of Dresden won accolades from Taiwan and German officials. The 12-inch plant, worth 10 billion euros ($11 billion), broke ground in August.

Taiwan assured complete support to Europe in developing its domestic semiconductor base, the Taipei Times cites Deputy Minister of Foreign Affairs Francois Wu at a German National Day event in Taipei on Friday.

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The disruption of semiconductor supply chains during the onset of the COVID pandemic in China prompted countries to consolidate their semiconductor technology position instead of depending completely on the Asian nation.

The Taiwanese chipmaker collaborated with Infineon Technologies AG IFNNF IFNNY, NXP Semiconductors NV NXPI and Robert Bosch GmbH to construct the plant.

Prior reports indicated Taiwan Semiconductor’s 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.

Wu told the Taipei Times that the total trade between Taiwan and Germany in 2023 topped $22 billion.

Collaborations between Germany and Taiwan have gone beyond semiconductors, including imparting training to Dresden University of Technology students.

Taiwan Semiconductor stock gained 104% in the last 12 months, fueled by the artificial intelligence frenzy. The company’s geographical expansion in the US and Japan remains on track, demonstrating continued demand for AI technology as global hyperscalar invests in its AI ambitions.

However, the contract chipmaker remains susceptible to higher power demand as it started commercializing the 3 nm process.

According to S&P Global, Taiwan Semiconductor’s power demand could triple by 2030 due to the higher energy demand of the advanced processes (7 nm and below) that require extreme ultraviolet (EUV) exposure machines.

Investors can gain exposure to the semiconductor sector through the EA Series Trust Strive US Semiconductor ETF SHOC and the Columbia Semiconductor and Technology ETF SEMI.

Price Action: TSM stock is down 0.17% at $180.66 premarket at last check Monday.

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