TSMC is considering Germany as location for its first European chip factory

TSMC is considering building a chip factory in Germany. The company announced this during a conference call with shareholders on Monday. It would be the first TSMC chip factory on European territory. The manufacturer is also considering a fab in Japan.

TSMC indicates that it is currently still evaluating its options and that the company is still at an early stage, also writes Japanese business newspaper Nikkei. “We are in the preparatory phase to see if we go to Germany,” Chairman Mark Liu told TSMC shareholders.

“It is still very early, but we are seriously evaluating it, and a decision will depend on the needs of our customers,” said the TSMC chairman. There are several customers of TSMC in Germany, including chip designer Infineon. TSMC also indicates that it is considering a chip factory in Japan. To that end, the company holds weekly talks to “assess the viability of such a project,” Bloomberg reports. The company is also in talks with Japanese customers.

It is the first time that TSMC has publicly announced that it is considering a chip factory in Europe. Digitimes released a report earlier this month in which it stated that TSMC was considering a German chip factory, EENews also writes. That medium then stated that it is a 12nm chip factory near the German city of Dresden, although the company has not yet confirmed this.

It has been known for some time that TSMC wants to expand outside of Taiwan. The company builds chip factories on American soil, among other things. The manufacturer is currently working on a 5nm chip factory in Arizona, which will open in 2024. The Taiwanese semiconductor manufacturer would also consider setting up multiple chip factories in the US, for example for 3nm production.

The European Union, in turn, is investing heavily in chip production and indicated earlier this year that it wants to collaborate with semiconductor manufacturers such as TSMC. In the meantime, the European Commission has set up a semiconductor alliance to work on strengthening Europe’s position in the chip sector.

TSMC then reported that the company “doesn’t rule out any possibility”, but that the Taiwanese semiconductor manufacturer had no concrete plans to build a European semiconductor factory.

TSMC is not the only company considering building a European chip factory. Intel previously indicated that it wants to build a fab in Europe, for example in Germany or the Benelux. The company wants a subsidy of eight billion euros for this. According to the chip giant, this is necessary to make it more attractive to build the factory in Europe, compared to Asian countries, where the construction of such a factory would be considerably cheaper. Among other things, the company would consider spreading its expansion plans across several EU member states.