‘TSMC will agree to build chip factory in Germany this week’

According to Handelsblatt sources, TSMC has agreed to the construction of a chip factory near the German city of Dresden. The chipmaker’s board will vote on this on Tuesday, August 8. The board is expected to vote in favor of the proposal.

TSMC’s board of directors will soon vote in favor of the factory, anonymous German government sources report to Handelsblatt. The company will build its first chip factory in Europe. The factory will be located near Dresden and will cost up to ten billion euros, according to previous reports. The German government would make five billion euros in subsidies available for construction, Handelsblatt reported on Monday. This is consistent with previous reports from Bloomberg.

Taiwanese chipmaker TSMC has been in discussions with Germany for two years about the possible construction of a chip factory. The factory is expected to produce chips and microcontrollers for cars using a 28nm process. TSMC would build the factory in collaboration with partner companies Bosch, Infineon and NXP, according to previous rumors and confirmed by Handelsblatt.

Kevin Zhang, senior vice president at TSMC, previously reported to media that the company would make a decision on the construction of a German chip factory ‘at the earliest’ in August. The CEO also confirmed that the factory would ‘initially’ produce 28nm chips, although the factory could be upgraded to newer nodes in the future.

TSMC will not be the only chipmaker to come to Europe. Intel will also build a chip factory near the German city of Magdeburg. That manufacturer initially planned to build two factories for 18 billion euros with expansion options to eight factories on the location. The scope of Intel’s initial investments was recently increased to EUR 30 billion. The chipmaker received extra subsidy in return.