Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it plans to spend another US$14 billion to US$15 billion next year as accelerating deployment of 5G networks boosts demand for its advanced chips.
The company told an annual supply chain forum in Hsinchu that the planned capital expenditure — the same as this year’s level — would mainly be used on new facilities and equipment.
More than half of the spending increase will be earmarked for the mass production of chips using its 5-nanometer technology, TSMC said.
“The acceleration of 5G deployment across the world is leading to much stronger demand for our 7-nanometer and 5-nanometer capacity,” said J. K. Wang (王建光), senior vice president of TSMC’s operations and fab operations. “As a result, we [in October] raised capital spending for 2019 by US$4 billion. We expect next year’s capital spending will be at a similar level.”
5G technology provides low-latency and high-bandwidth connections so that artificial intelligence devices can make the right decisions instantly, Wang said.
All of these devices would generate strong demand for faster and more power-efficient semiconductors made by TSMC, he said.
To satisfy customers’ demand, TSMC plans to start volume production of chips using 5-nanometer technology in the first half of next year at a Tainan fab as scheduled, Wang said.
“We will gain much more business as we ramp up deployment of 5-nanometer [technology] next year,” he said.
TSMC in October said it would be the first wafer foundry capable of providing 5-nanometer chips when the technology becomes commercially available.
It plans to start mass production of chips using 3-nanometer technology in 2022, in line with Moore’s Law that transistor count will double every two years due to shrinking transistor dimensions.
To facilitate the development of next-generation technologies beyond 3 nanometers, TSMC plans to build a new research and development center in Hsinchu County’s Baoshan Township (寶山) next quarter, Wang said.
The center would be able to house 8,000 engineers after construction is completed in 2021, TSMC said.
About 700 suppliers led by Applied Materials Inc and ASML Holding NV attended the forum, which saw TSMC present awards to 14 excellent suppliers, including Taiwan Speciality Chemicals Corp (台灣特品化學), as TSMC gradually adopts locally made equipment and materials.
Taiwan Speciality Chemicals is 30 percent owned by silicon wafer maker Sino-American Silicon Products Inc (SAS, 中美矽晶).
SAS also owns a 50 percent stake in silicon wafer manufacturer GlobalWafers Inc (環球晶圓), which also supplies TSMC.
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Huawei Technologies Co’s (華為) latest smartphones carry a version of the advanced made-in-China processor it revealed last year, results from an independent analysis showed. This underscored the Chinese company’s ability to sustain production of the controversial chip. The Pura 70 series unveiled last week sports the Kirin 9010 processor, research firm TechInsights found during a teardown of the device. This is a newer version of the Kirin 9000s, made by Semiconductor Manufacturing International Corp (SMIC, 中芯) for the Mate 60 Pro, which had alarmed officials in Washington who thought a 7-nanometer chip was beyond China’s capabilities. Huawei has enjoyed a resurgence since
purpose: Tesla’s CEO sought to meet senior Chinese officials to discuss the rollout of its ‘full self-driving’ software in China and approval to transfer data they had collected Tesla Inc CEO Elon Musk arrived in Beijing yesterday on an unannounced visit, where he is expected to meet senior officials to discuss the rollout of "full self-driving" (FSD) software and permission to transfer data overseas, according to a person with knowledge of the matter. Chinese state media reported that he met Premier Li Qiang (李強) in Beijing, during which Li told Musk that Tesla's development in China could be regarded as a successful example of US-China economic and trade cooperation. Musk confirmed his meeting with the premier yesterday with a post on social media platform X. "Honored to meet with Premier Li