TSMC's Mammoth NT$1.5 Trillion Investment in Kaohsiung: A Bold Bet on Taiwan's Tech Future

Taiwan Semiconductor Manufacturing Co. (TSMC) doubles down on domestic investment with massive expansion, promising thousands of jobs and leading-edge chip technology.

Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) has announced a monumental investment of NT$1.5 trillion (US$45.2 billion) to expand its advanced 2-nanometer chip capacity in Kaohsiung, Taiwan. This significant commitment underscores TSMC's dedication to bolstering investment and technological advancements within its home base.

The announcement follows the company's earlier commitment to invest US$100 billion in the United States, which initially sparked concerns about Taiwan's potential loss of its competitive advantage. However, this latest domestic investment signals TSMC's firm resolve to maintain its leadership in producing advanced chips, including 2-nanometer technology, and its continued commitment to Taiwan.

The capacity expansion ceremony was held at the construction site of Fab 22 in Kaohsiung, which will house five chip manufacturing facilities. The first facility is scheduled to begin volume production in the second half of this year.

“Today’s 2-nanometer capacity expansion ceremony holds significant importance for global semiconductor technology development, marking the successful progress of TSMC’s world-leading 2-nanometer process,” said TSMC co-chief operating officer Y.P. Chyn (秦永沛) at the ceremony. “It showcases TSMC’s commitment to meeting strong market demand, continuously expanding capacity to support customers.”

Chyn continued, “In Kaohsiung, we will have Phase 3, Phase 4 and Phase 5 wafer fabrication plants. All of them will germinate here.”

Currently, TSMC is installing equipment at the first phase of Fab 22 and has completed structural engineering works at Phase 2.

The ceremony was attended by high-ranking government officials, including Premier Cho Jung-tai (卓榮泰), Kaohsiung Mayor Chen Chi-mai (陳其邁), Executive Yuan Secretary-General Kung Ming-hsin (龔明鑫), and Minister of Economic Affairs J.W. Kuo (郭智輝).

The massive investment in Fab 22 is expected to generate over 7,000 direct high-tech jobs and 20,000 construction jobs. Furthermore, TSMC's operations, including its supply chain partners and related services, support approximately 500,000 jobs and generate around NT$3 trillion in production value annually.

TSMC is actively engaging with authorities to secure additional land for new chipmaking facilities, according to Chyn.

The company anticipates that its 2-nanometer process technology will be widely adopted in the next generation of leading-edge products, including supercomputers, mobile devices, and cloud-based data centers.

TSMC projects that its 2-nanometer technology will contribute to end products with a market value of US$2 trillion within five years of volume production.

A 2-nanometer chip fab in Hsinchu is also progressing as planned.

TSMC highlights that its 2-nanometer technology offers a 10-15% speed improvement and 25-30% lower power consumption compared to its 3-nanometer technology, making it highly attractive to almost all technology innovators worldwide.