Taiwan Semiconductor Manu-facturing Co (
Deputy Chief Executive Tseng Fan-chen (
TSMC is under pressure to move across the Taiwan Strait as Chinese rivals such as Semiconductor Manufacturing International Corp begin production and offer cheaper prices, and foreign chipmakers set up shop there to take advantage of cheaper production costs.
"You need to sleep with your enemy to ensure that it doesn't get out of hand," said Albert King, who counts TSMC shares among the US$2.5 billion he helps to manage at HSBC Asset Management Taiwan Ltd. "TSMC may tear down some of its old factories in Taiwan and move them to China."
Local rivals such as Semiconductor Manufacturing International Corp, which started production two months ago, are undercutting chip prices, some investors said.
US-based Fairchild Semiconductor International Inc yesterday said it will spend US$200 million to build a plant and a warehouse in China.
The TSMC visit comes as Tai-wan's government is expected to ease its ban on Taiwan chipmakers investing in China. An announcement could come as early as Dec. 13, said the Web site of DigiTimes, a newspaper that covers Asian technology companies.
"Tseng went to Shanghai and took a look at several places," Tzeng said, confirming a DigiTimes report yesterday on the trip. "We don't have any solid plans for investment."
Semiconductor Manu-facturing International denied the company is undercutting the prices of its Taiwan rivals.
"We are charging the same as companies in Taiwan," Chief Executive Officer Richard Chang (張汝京) said during an industry conference in Taiwan yesterday.
The Shanghai-based company is able to offer prices competitive with TSMC partly because it bought used equipment and other gear at a discount amid the worst slump in the chip industry, Chang said.
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