[News] TSMC Breaks Ground on German Plant, Looking to Establish a Semiconductor Hub in Europe

According to a report from UDN, TSMC held a groundbreaking ceremony yesterday for its Dresden, Germany plant, offering a significant boost to the EU’s efforts to stabilize its chip supply.

TSMC Chairman C.C. Wei led a team of top executives at the event, joined by key officials including German Chancellor Olaf Scholz. European Commission President Ursula von der Leyen also attended, bringing with her the announcement that the EU has approved a EUR 5 billion subsidy for the Dresden plant.

TSMC announced last August that it would partner with Bosch, Infineon, and NXP Semiconductors to establish the European Semiconductor Manufacturing Company (ESMC) in Germany.

The joint venture will construct a 12-inch wafer plant, with TSMC holding a 70% stake, while Bosch, Infineon, and NXP each hold 10%. Construction is planned to start in the second half of this year, with mass production expected by the end of 2027.

The planned fab is expected to have a monthly production capacity of 40,000 12-inch wafers on TSMC’s 28/22 nanometer planar CMOS and 16/12 nanometer FinFET process technology.  TSMC will be responsible for the plant’s operations.

Following the U.S.-China tech war, the EU passed the “Chips Act” to fully support the development of the semiconductor industry, attracting key investments from companies such as TSMC, Intel, Belgium’s IMEC, GlobalFoundries, and GlobalWafers, all of which sought subsidies for their new European operations.

TSMC’s joint venture proposal, exceeding EUR 10 billion, stands as the largest global direct investment in Saxony’s history.

When C.C. Wei took the stage, he began by thanking the German government. He revealed that when he first met with the German Chancellor, he had prepared a polite speech to decline the offer of building a plant in Germany.

However, when the Chancellor mentioned that a budget had already been reserved for TSMC, Wei eventually found himself agreeing to the project.

C.C. Wei further highlighted that TSMC’s total investment in the German plant exceeds EUR 10 billion and is expected to create around 2,000 jobs.

He explained that the decision to locate the plant in Dresden was due to its proximity to TSMC’s customers and access to a large pool of talented individuals. Wei also pledged to continue recruiting and nurturing talent in the region, with the goal of making ESMC the most important semiconductor manufacturing hub in Europe.

Read more

• [News] TSMC Maintains Overseas Expansion Strategy, Unfazed by Geopolitical Disruptions
• [News] TSMC’s German Plant Reported to Break Ground in Weeks, Expected to Begin Production by Late 2027

(Photo credit: TSMC)