Reuters: Negotiations for German TSMC chip factory are at an advanced stage
Negotiations for the construction of a German TSMC chip factory are at an advanced stage. This is reported by the Reuters news agency. Discussions between TSMC and Germany are now focused on government subsidies to support the investment.
TSMC is currently in discussions with the German state of Saxony, insiders report to Reuters. A source calls the discussions ‘serious and advanced’. Delegations from the state are said to have traveled to Taiwan for talks with the Taiwanese chip maker. The two parties are now said to be discussing government support for the construction of the factory. TSMC wants a subsidy to finance construction, partly because of the higher construction costs in that country.
The subsidy would be distributed as part of the European Chips Act. This upcoming law will release up to 45 billion euros in subsidies for the chip sector, in order to become less dependent on production capacity from other countries. A large part of that amount is financed by individual member states, including Germany, which is also in negotiations for the construction of an Intel chip factory.
The Taiwanese chipmaker has been talking about the possible arrival of a chip factory in Germany for some time. TSMC said in July 2021 that the company was considering building one, though it provided few concrete updates since then. In December, the company said that TSMC had no concrete plans yet to build a German chip factory, but would continue to consider all options. There have been reports recently about ongoing discussions. A team from TSMC is said to have traveled to Germany in October to view possible locations. According to previous reports, the factory is possibly built in Dresden. That is the capital of Saxony, where companies such as GlobalFoundries and Bosch already have chip factories.
TSMC has been expanding outside its home country for some time. The company is currently working on a 4nm chip factory in the US state of Arizona. A 3nm chip factory should also follow later on the same campus. If the German TSMC factory is built, it will probably produce less advanced chips. This would mainly concern chips used by the automotive sector, a source told Reuters.