Taiwan’s TSMC has announced plans to build nine new advanced fabs this year — eight for chip production and one for packaging — as demand for high-performance computing (HPC) and artificial intelligence (AI)-based components soars.
Image Source: TSMC
Previously, the company built an average of five factories a year, but now it has decided to speed up the pace. According to TSMC, the new facilities will be located both in Taiwan and abroad. The key facility will be Fab 25 in Taichung, the company’s most advanced facility, which will produce chips using a next-generation process technology that surpasses the 2-nanometer level, the Taipei Times reports.
In Kaohsiung, the company will build five factories to produce chips using 2-nm and A16 processes, with the latter being its first angstrom-level development. Mass production of 2-nm chips will begin in the second half of the year at two new factories in Hsinchu and Kaohsiung. At the same time, TSMC is expanding its presence abroad: this year, construction will begin on a factory in Arizona (USA) and a second factory in the Japanese prefecture of Kumamoto.
TSMC is particularly focused on ramping up its CoWoS chip packaging capacity, which the company estimates has seen incredible demand over the past two years. It will double its CoWoS capacity in 2025 and grow at an average annual rate of 80% from 2022, up from its previous forecast of 60%. This should help ease the shortage caused by the boom in AI chips, for which Nvidia is a key customer.
«“2024 is the year of AI for the semiconductor industry, and this trend will continue thanks to demand for AI data centers,” said Kevin Zhang, vice president of operations at TSMC. The company expects 3nm chip shipments to grow 60% over 2023, and total shipments to increase 12-fold over 2021.
Despite external risks such as US trade tariffs, TSMC forecasts the global semiconductor market to grow by 10% in 2025. By 2030, it will reach $1 trillion, with 45% of revenue coming from HPC devices, 25% from smartphones, 15% from automotive electronics, and 10% from the Internet of Things.
It is also noted that the automotive sector, despite excess inventory, still remains promising for TSMC. The company expects growth due to the transition of automakers to 5-nm and 3-nm technologies for autonomous driving systems – previously, the industry used less modern 12-nm and 8-nm chips.