TSMC to invest up to $100 billion over next three years to meet global chip demand

By: |
April 1, 2021 4:22 PM

Rival Intel said this month it will build two new factories at an existing campus in Arizona to make its own chips but also open them to outside customers in what is called a “foundry” business model in the chip industry.

The move comes as global companies reel from a shortage of semiconductor chips that initially forced auto companies to cut production, but is now hurting makers of smartphones, laptops and even appliances amid a pandemic-fueled rise in demand. (Image: Reuters)

Contract chipmaker TSMC said on Thursday it plans to invest $100 billion over the next three years to increase capacity at its plants, days after Intel announced a $20 billion plan to expand its advanced chipmaking capacity.

Taiwan Semiconductor Manufacturing Co, whose customers include Apple and Qualcomm, had
already flagged a plan to spend of between $25 billion-$28 billion this year, to develop and produce advanced chips.

The move comes as global companies reel from a shortage of semiconductor chips that initially forced auto companies to cut production, but is now hurting makers of smartphones, laptops and even appliances amid a pandemic-fueled rise in demand.

“We are entering a period of higher growth as the multiyear megatrends of 5G and high-performance computing are expected to fuel strong demand for our semiconductor technologies in the next several years,” TSMC said in a statement to Reuters. “In addition, the Covid-19 pandemic also accelerates digitalization in every aspect,” it said.

Shares in TSMC rose nearly 2% in late morning trade.

TSMC, like other technology firms, has benefited from the work-and-study-from-home trend during the Covid-19 pandemic, as people rushed to buy laptops, tablets and other equipment.

TSMC announced plans in May to build its own $12 billion factory in Arizona, in an apparent win for the administration of former U.S. President Donald Trump that was pushing to wrestle global tech supply chains back from China.

Rival Intel said this month it will build two new factories at an existing campus in Arizona to make its own chips but also open them to outside customers in what is called a “foundry” business model in the chip industry.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Everything to know about WhatsApp Pink, a new virus that can potentially give hackers complete control over your phone
2Covid-19 themed threats surge: McAfee sees cyber-attack detections increase by 114% in Q4 2020
3Google For Startups: Helping greenhorn ventures bloom