Germany approves first TSMC factory in the EU

Taiwan Semiconductor Manufacturing Company has been working to expand its manufacturing footprint for quite some time, and now it has a major factory deal in Germany set in motion.

TSMC is one of the largest semiconductor manufacturers on the planet, and works with a variety of different companies for their chip needs. Of course, one of the largest partners is Apple, but TSMC has ambitions beyond the Cupertino-based company's yearly requirements.

A new chip factory in Germany will cost upwards of $11 billion, with TSMC itself committing 3.5 billion euros, or $3.8 billion towards the effort, according to Reuters. Once the factory is up and running, it will be TSMC's first in Europe, and just the third for the company outside of Taiwan and China.

Germany sees a path to foster a more domestic approach to semiconductor manufacturing, especially for its automotive future in a bid to stay competitive in that market. This new plant is part of a wider movement by the European Union, which recently approved the European Chips Act that offers a 43 billion euro subsidy plan to propel domestic chip making.

Germany itself will be contributing 5 billion euros to the factory that will ultimately be built in Dresden.

TSMC continues to make deals that sees the chipmaker expand beyond its home territory, a move that Apple is trying to do in its own right. The company has been trying to move beyond its China dependency for years now, with some efforts in the United States.

In that process Apple has turned to India. It has been a slow process so far, and will remain that way for quite some time, but expectations are high that Apple may see India exporting one in every five iPhones by 2025.

Apple's manufacturing partnership with TSMC has been longstanding one, so much so that it was recently reported Apple has a "sweetheart deal" that saves the company millions of dollars because it only charges Apple for "known good dies." However, a subsequent report based on details provided by Ming-Chi Kuo says that's not true at all.

Latest Exclusives

Latest comparisons

21 Comments

waveparticle 3 Years · 1497 comments

About 1 year ago

LOL Germany with the world popular advance auto industry and nearby Netherland ASML company cannot fab the advanced semiconductor chips? LOL This thing is very political.

mayfly 1 Year · 385 comments

waveparticle said:

LOL Germany with the world popular advance auto industry and nearby Netherland ASML company cannot fab the advanced semiconductor chips? LOL This thing is very political.

Achtung Baby! It's not politics. It's about the money. It's always about the money.

spheric 9 Years · 2705 comments

waveparticle said:

LOL Germany with the world popular advance auto industry and nearby Netherland ASML company cannot fab the advanced semiconductor chips? LOL This thing is very political.

We're going to desperately need manufacturing jobs when the auto industry downsizes as Chinese companies take over the market that German manufacturers were subsidised into ignoring under Merkel…

Long story short: The German auto industry got major incentives from the CDU-led government to keep reselling the obviously obsolete combustion tech that cost them ZERO in R&D, at effectively pure profit.

This money was diverted from maintaining public transport infrastructure, which is today screwing us in a Big Way™, and adding insult to injury, it was used to generate MASSIVE profits for shareholders and manager bonuses, rather than being effectively invested into EV development. This has Chinese and other manufacturers a decade-long lead on technology.

So in the past few months, we've seen Mercedes announce that they're moving exclusively upmarket and dropping out of the affordable segment entirely, while Audi and Volkswagen have announced, er, "cooperations" with Chinese manufacturers to build EVs for the Chinese market, where German car sales have dropped off a cliff.

I figure that ten years from now, Audi and VW will sell rebadged, upmarked cars built in China, while the exact same car with a different interior and minor external differences will be available from the actual manufacturer at a much lower price.

So we need manufacturing jobs, and chip manufacturing — Infineon, Intel et al. have already announced or started building plants, as well.

The U.S. has made a similar push with the Chips and Science Act, albeit for slightly different reasons AFAICS.

hydrogen 14 Years · 314 comments

Accepting to pay 5B$ for 2000-3000 jobs is insane.

avon b7 20 Years · 8046 comments

hydrogen said:

Accepting to pay 5B$ for 2000-3000 jobs is insane.

It's more than those jobs. It's a seeds for the future programme and a strategic dependency.