TSMC to Invest $100 Billion to Increase Semiconductor Output
April 01 2021 - 9:25AM
Dow Jones News
By Stephanie Yang
TAIPEI -- Taiwan Semiconductor Manufacturing Co., a major chip
supplier to Apple Inc., said it would invest $100 billion over the
next three years to increase production capacity as demand
surges.
The investment builds on a record annual capital-expenditure
budget for the world's largest contract chip maker, at a time when
chips are in short supply around the world. In a statement, the
company said it expects strong demand over the next several years,
a trend driven by growth in 5G and high computing capabilities and
accelerated by the Covid-19 pandemic.
"TSMC is working closely with our customers to address their
needs in a sustainable manner," the company said Thursday.
In January, TSMC said it would spend $25 billion to $28 billion
on developing advanced chips and building plant capacity in
2021.
Other chip makers are also pouring money into increasing
capacity. Intel Corp. recently said it would spend $20 billion on
two new chip factories in the U.S., starting in 2024. The
semiconductor giant had lagged behind competitors such as TSMC and
Samsung Electronics Co. in market share and technology
capabilities, leading to the ouster of Bob Swan as chief
executive.
Samsung plans to invest about $116 billion by 2030 to further
diversify its semiconductor production. Globalfoundries Inc., a
major U.S.-based contract chip maker, has said it is doubling its
capital investment this year to boost capacity.
Semiconductors are an important component in many consumer goods
from phones to cars, and the pandemic created new demand for
electronics such as work-from-home equipment and gaming consoles.
As a result of the supply constraints, auto manufacturers such as
Ford Motor Co. and Volkswagen AG have halted production of vehicles
that use chips for functions such as engine management, automatic
braking and assisted driving.
The shortage has also highlighted the supply chain's dependence
on TSMC and Taiwan's semiconductor industry. President Biden's $2.3
trillion infrastructure plan included $50 billion for the U.S.
semiconductor industry in an effort to mitigate reliance on
overseas suppliers.
TSMC said last year, in a decision praised by the Trump
administration, that it would invest $12 billion to build a chip
factory in Arizona with the support of the federal and state
government. The two factories that Intel announced in March will
also be built in Arizona.
Write to Stephanie Yang at stephanie.yang@wsj.com
(END) Dow Jones Newswires
April 01, 2021 09:10 ET (13:10 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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