tsmc invests over 200 billion dollars in new taiwan factories
Southern Taiwan, Monday, 20 January 2025.
TSMC, a leader in semiconductor manufacturing, has announced plans to invest over 200 billion dollars in building two new CoWoS factories in the Southern Taiwan Science Park Phase Three. This strategic move aims to enhance TSMC’s packaging technology, crucial for its semiconductor production capabilities. The decision follows rumors of order reductions, which the company seems eager to dispel by expanding its production capacity. TSMC’s commitment to boosting its CoWoS technology reflects ongoing demand, particularly from major clients like NVIDIA, which emphasizes the need for advanced packaging. The company has applied for land in the science park and aims to start construction soon, signaling strong confidence in the future of high-performance computing. Despite market rumors, the expansion underscores a robust outlook for TSMC’s operations, reinforcing its position in the competitive semiconductor industry.
Major expansion of advanced packaging facilities
TSMC plans to construct two new CoWoS (Chip-on-Wafer-on-Substrate) factories in Southern Taiwan Science Park Phase Three, with an investment exceeding NT$200 billion [1][2]. The new facilities will occupy 25 hectares, surpassing the 20-hectare scale of TSMC’s Chiayi facility [1][4]. Construction is set to begin in March 2025, with a targeted completion date of April 2026 [1][3].
Strategic response to market demands
NVIDIA CEO Jensen Huang’s recent visit to Taiwan confirmed strong demand for CoWoS technology, particularly CoWoS-L capacity [1][3]. TSMC Chairman Mark Liu emphasized at an investor conference that the company continues to expand production to meet customer needs [2][4]. The expansion includes plans for eight CoWoS facilities in total, with six located in the Southern Taiwan Science Park [1][3].
Market implications and stock performance
The announcement has positively impacted TSMC’s stock (TSM:NYSE), which traded at NT$1,130 on January 20, 2025, showing a 0.89% increase [1]. Foreign investors demonstrated confidence with a net buy of 13,346 shares [1]. The expansion project represents a significant portion of TSMC’s planned capital expenditure of $38-42 billion for 2025 [3][4].