TSMC to expedite Arizona expansion, upgrade; keep investing in Taiwan

Taipei, Oct. 16 (CNA) C.C. Wei (魏哲家), chairman of CEO of Taiwan Semiconductor Manufacturing Co. (TSMC), said on Thursday that the world's largest contract chipmaker will speed up its pace in production expansion and technology upgrades in the U.S. state of Arizona, while continuing to invest in Taiwan.

Speaking at an investor conference, Wei said TSMC's investment project in Arizona proceeded smoothly, adding the company has acquired a large piece of land closer to the existing compound for expansion.

Wei said TSMC is also setting its sights on introducing its sophisticated 2 nanometer process, slated to begin commercial production in Taiwan in the fourth quarter of this year, to the U.S. compound.

Wei added TSMC will build its Arizona complex as a megafab cluster to meet strong demand for chips used in smartphones, artificial intelligence applications and high-performance computing devices from its clients.

TSMC is investing US$65 billion in Arizona to build three advanced wafer fabs. The first fab started commercial production in 2024.

The chipmaker has pledged to pour an additional US$100 billion into Arizona over the next few years to build three more wafer fabs, two IC assembly plants and one research and development center.

Before the two IC assembly plants are ready to operate, Wei said, TSMC has worked with an outsourced semiconductor assembly and test (OSAT) company, which has broken ground on a plant in Arizona, and the cooperation is expected to help the chipmaker provide services to its clients in the United States.

Wei did not identify the OSAT partner. However, U.S.-based Amkor Technology Inc. announced in August the building of an IC assembly and testing plant in Arizona, with production scheduled to start in early 2028.

In October 2024, TSMC and Amkor announced they would strengthen their cooperation to develop 3D Chip-on-Wafer-on-Substrate (CoWoS) packaging and integrated fan-out (InFO) assembly services.

Wei said demand for CoWoS services remained tight but TSMC has kept narrowing the gap between demand and supply by expanding the services during the current AI boom.

In Taiwan, Wei said the efforts in building more advanced wafer fabs and IC assembly plants will not slow down on the back of strong support from the government despite its aggressive expansion overseas.

After the 2nm process starts mass production in Hsinchu and Kaohsiung later this year, Wei said, production will accelerate in 2026 and the more sophisticated N2P and A16 processes are expected to begin commercial production in the second half of 2026.

In Kumamoto, Japan, Wei said, the first fab using specialty processes has mass-produced chips since the end of 2024, while construction of the second has also started and the timeframe of mass production will be decided based on market reality.

In Dresden, Germany, Wei said, construction of a fab also using specialty processes proceeded well and TSMC will review clients' demand and market conditions to map out a mass production schedule.