EU officials persuade TSMC to set up factories in Europe to lay out the semiconductor industry.

At a time when the global chip shortage is growing, EU officials attach particular importance to technological "sovereignty" and will discuss with executives of TSMC and Intel next week to lobby them to step up their efforts to set up factories in Europe.

On April 30th Thierry Bretton (Thierry Breton), EU internal market commissioner, will meet with Intel CEO Pat Kissinger (Pat Gelsinger) and hold a video conference with TSMC Europe President Maria Masade (Maria Marced).

It is worth noting that Kissinger announced in March this year that Intel intends to build a fab in Europe and plans to announce the location within next year. At that time, Kissinger also announced that he would invest 20 billion US dollars to build two new fabs in Arizona.

But judging from the current news, Bretton prefers industry leader TSMC. Brighton and TSMC will discuss the possibility of building new contract chip factories in Europe, as well as other possible partnerships, according to people familiar with the matter.

EU strives to develop semiconductor industry

The EU's efforts to woo chipmakers such as TSMC are in line with the strategic goals announced earlier by the European Commission, which hopes that Europe's share of global semiconductor production will double to 20 per cent by 2030. at the same time, state-of-the-art 2-nanometer chips will be produced.

"increased autonomy does not mean that we will be isolated from the global supply chain," Mr Bretton said. "We will continue to build bridges with our international partners while exploring how to increase European capacity, but we need to take the lead."

But there are also objections that setting up a large wafer factory in Europe could prove to be a strategic mistake because the continent does not produce high-end electronics or a modern chip design industry and does not have market conditions. Infineon, St and NXP, the local European chipmakers, abandoned their plans to stay ahead several years ago and are now focusing on market segments such as cars.

TSMC continues to expand production.

At a time when the world is mired in a chip shortage, TSMC has been expanding production recently. TSMC announced on April 1st that it will invest US $100 billion to expand production capacity, build and expand wafer plants over the next three years, and increase capacity in advanced processes and mature processes will go hand in hand.

By the way, on April 14 this year, there was a sudden power outage in Phase 7 of TSMC's South Branch 14 plant, which affected 30,000 wafers, which made the already shortage of chips even worse.

Then, when the results were announced on April 15, TSMC CFO Huang Renzhao announced an increase in capital investment to US $30 billion in fiscal year 2021 from US $25-28 billion, of which about 80 per cent will be used for advanced processes in 3, 5 and 7nm processes, about 10 per cent will be allocated to advanced packaging and optical masks, and about 10 per cent will be used for special processes.

In addition to the news of production expansion on April 22nd, TSMC announced that its board of directors had approved $2.89 billion to expand mature production processes in response to the global chip shortage. The additional capacity is scheduled to begin mass production in the second half of 2022 and will reach 40000 pieces by mid-2023.