The Investment Commission yesterday gave the green light to Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) plan to build a 12-inch-wafer plant in China.
The world’s largest contract chipmaker plans to spend US$3 billion building a wholly owned plant in Nanjing, as it seeks to better serve customers and gain global market share.
The approval is the first by Taiwanese authorities since President Ma Ying-jeou’s (馬英九) administration in August last year eased restrictions to allow chipmakers’ to wholly own production facilities in China.
Photo: CNA
“The investment plan could help TSMC secure its leading position in China and boost global market share,” commission Executive Secretary Emile Chang (張銘斌) told a news conference.
After the Nanjing facility starts mass production, the chipmaker’s global share might rise to 57 percent from its present 55 percent, while its share in the Chinese market might climb to 50 percent from 46 percent, Chang said.
TSMC is to wire US$1 billion from Taiwan to China for the construction of the Nanjing plant and provide the remaining US$2 billion through the company’s overseas subsidiaries, the commission said.
The Nanjing facility is expected to hire 1,200 employees and manufacture 20,000 12-inch wafers per month, Chang said, citing TSMC’s application.
The plan is to begin production of advanced 16-nanometer (nm) chips in the second half of 2018, Chang said.
TSMC is expected to start mass production of its advanced 10nm chips in Taiwan later this year and begin trial production of its 7nm chips — the next generation of the firm’s technology — by 2018.
The company, which supplies chips used in Apple Inc’s iPhones, is to comply with a requirement to produce chips less advanced by one generation in China, Chang said.
To ensure that the nation’s technological advantage is preserved, TSMC has to submit evidence of its 10nm production in Taiwan to the Industrial Development Bureau before it starts to install equipment in the Nanjing plant, Chang said.
In addition to the investment plan in China, TSMC also plans to invest NT$860 billion (US$25.44 billion) in Taiwan over the next three years, Chang said.
The company is to invest NT$300 billion this year and NT$280 billion next year, he said, adding that it plans to invest another NT$280 billion in 2018.
The chipmaker is to recruit between 2,500 and 3,000 employees in Taiwan over each of the next three years to accommodate the firm’s growing capacity and scale, Chang said.
The Nanjing facility would serve both Chinese clients and global customers, TSMC said, adding that it is to start construction of the plant in the second half of this year.
The chipmaker said it would keep its newest technology and research and development base in Taiwan and that the investment in China would not affect its capacity expansion plans in Taiwan.
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