Chip manufacturer TSMC decides to build factory in Dresden

Concerns about TSMC funding:

The Taiwanese chip manufacturer TSMC wants to build a new chip factory in Dresden together with Bosch, Infineon and NXP. The management committee gave the green light, TSMC announced after a board meeting.

Bosch, Infineon and NXP are said to each hold ten percent of the joint venture, with TSMC holding 70 percent.

According to the announcement, around 2,000 jobs will be created. The groundbreaking is planned for the second half of 2024. The start of production is planned for 2027.

exact investment level still unclear

TSMC therefore expects that the total investment will exceed ten billion euros. The final amount of the investment will be decided when there is clarity about the state funding for the project.

Part of the investment costs will be covered by taxpayers in Germany, because the deal includes a government subsidy package, as is customary internationally. According to the “Handelsblatt”, the federal government has promised to support the factory construction with five billion euros. The EU Commission must make the final decision on funding.

Habeck: Many companies will benefit

Federal Economics Minister Robert Habeck welcomed the TSMC decision. The construction of the factory will make a substantial contribution to supplying Germany and Europe with semiconductor chips, explained the Greens politician. The investment decision shows that Germany is an attractive and competitive location – especially when it comes to key technologies such as microelectronics.

However, further efforts are needed, for example work is being done on accelerated approval processes and reducing bureaucracy. “Robust domestic semiconductor production is of particular importance for our global competitiveness, because semiconductors keep our world running and make the transformation towards climate neutrality possible in the first place,” says Habeck. “Without them, no computer runs, no car drives, neither wind nor solar systems can produce energy.”

The project secures qualified jobs and added value in Germany. “At the same time, many companies along the value chain and the user industries, from large companies to medium-sized companies, benefit from an investment of this magnitude.”

billions for setting up factories

In May, the German group Infineon started building a five billion euro chip factory in Dresden. Bosch and the US company Globalfoundries also have large plants in Dresden. TSMC is the largest chip contract manufacturer in the world.

The federal government supports the settlement of semiconductor factories with sums in the billions. With a total investment volume of 30 billion euros for a new location, Intel in Magdeburg is to receive almost ten billion from the state. Infineon is aiming for government funding of one billion euros for the expansion of its Dresden plant.

state government: “Good news”

After the TSMC announcement, the Saxon government spoke of “good news”. Together with Intel’s decision in favor of Magdeburg and the expansion of Infineon in Dresden, this settlement will give regional development in Central Germany a huge boost, explained Saxony’s Minister for Regional Development, Thomas Schmidt.

According to the CDU politician, the entire European economy will benefit. Europe must become more independent of non-European suppliers.

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