Wednesday, May 3, 2023 5:05 pmWednesday, May 3, 20232 Comments

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Major Apple supplier TSMC is in talks with partners to spend up to €10 billion ($11 billion) to build a chip fabrication plant in Saxony, Germany, Bloomberg News reports Thursday citing “people familiar with the matter.”

Jillian Deutsch and Alberto Nardelli for Bloomberg News:

The planned venture between TSMC, NXP Semiconductors NV, Robert Bosch GmbH and Infineon Technologies AG will include state subsidies and would have a budget of at least €7 billion, with the total investment likely closer to €10 billion, the people said, asking not to be identified because the information is private. A final decision has not been made and the plans could still change, they said.

TSMC Chairman Mark Liu told shareholders in 2021 that the chipmaker had started assessments on setting up manufacturing operations in Germany, Europe’s largest economy. The proposed European plant would focus on chips for the automotive sector, Chief Executive Officer C. C. Wei has said.

Similar projects in Germany have sought as much as 40% of their funding from subsidies as the European Union attempts to double its share of global semiconductor production by 2030. In April, the EU passed the €43 billion Chips Act to boost domestic output after supply chain disruptions during the Covid-19 pandemic and as tensions between the US and China escalate.

Any state aid would require approval from the European Commission, and the consortium is in talks with officials over the size of the package, the people said. In Japan, where TSMC is spending $8.6 billion with partners to build a plant, it will receive about half of the funding from the government.

TSMC is Taiwan’s biggest company and Apple Inc.’s main chipmaker.

MacDailyNews Take: The more chip production can be diversified, the better!

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