Taiwan’s TSMC to Build First European Chip Plant in Germany
Taiwan Semiconductor Manufacturing Co. will build its first European chip factory with support from the German government, the latest move to make the continent less dependent on high-tech imports out of Asia. TSMC said it had approved a $3.8 billion investment in the factory in Germany, with total investments in the plant expected to exceed 10 billion euros, equivalent to $11 billion, including government support.
The German Economics Ministry said the government would support the project subject to approval by the European Union, which has eased limits on government subsidies for semiconductor projects. The widely anticipated decision comes weeks after Berlin said it would pay €10 billion to support a €30 billion investment by Intel, the U.S. chip maker, in two plants in Magdeburg, in eastern Germany—among the biggest foreign investments ever made in the country.
The EU is seeking to double its share of the global semiconductor market as part of a broader effort to strengthen its high-tech supply chains and reduce its dependence on outside suppliers in high-growth industries. The effort is partly a reaction to the Biden administration’s $53 billion Chips Act, which aims to draw semiconductor investments to the U.S., and its Inflation Reduction Act, which offers incentives for support for green technology investments. Europe’s attempts to bolster its domestic chip industry also reflect a strategic effort to reduce its reliance on Chinese technology imports.
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