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Carmakers, Rejoice: World’s Largest Chip Maker Announces Massive Production Expansion

Everybody knows already that the chip shortage is here to stay, and if we are to trust all the experts worldwide, the only way to deal with the whole thing is to boost the production capacity as much as possible.
TSMC ready to spend billions on the new plant 6 photos
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In other words, the existing chip makers must pour in billions of dollars in their production lines to eventually align the output with the massive demand the world is dealing with. And of course, other players should step into this side of the market as well, especially as there’s clearly enough room for more chipmakers given every little industry sector out there is entering a smart revolution.

TSMC knows precisely that investing in its production capacity is the right thing to do. The company announced last November that it’s building a $7 billion factory specifically for the production of chips.

Located in Japan, the new facility would help Taiwan Semiconductor Manufacturing Co to meet the orders from customers in the region in a timely manner, especially as the plant was supposed to produce no less than 45,000 12-inch wafers per month.

But a few days ago, TMSC announced that it’s spending $1.6 billion more in the expansion of this new facility, as it plans to increase the production to 55,000 wafers per month.

The construction of the plant will kick off this year, while the first chips should be produced at some point in 2024.

The good news for automakers is that car supplier Denso Corp will receive a 10 percent stake in the new plant, so the industry should theoretically receive more help to deal with the shortage.

On the other hand, with so many analysts predicting the end of the chip crisis at some point in 2023, it remains to be seen if TSMC’s investments would still make sense in 2024. But as we said, there’s a good chance they will, especially because every little piece of electronics ends up using an army of chips these days.


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