TSMC will build a large chip manufacturing plant in Germany

The world’s largest computer chip maker, Taiwan Semiconductor Manufacturing Company (TSMC), will build a large chip manufacturing plant in the German city of Dresden. Reuters reported this on Tuesday, August 20.

TSMC’s new plant is expected to become a major supplier of semiconductors to European industry and automakers.

The European Commission approved 5 billion euros of German state aid for the construction of a chip manufacturing plant. The aid for the project, worth a total of 10 billion euros, is the largest approved under the European Chip Law and also the first for Germany.

It is also the first European project led by the world’s largest chip maker TSMC. The company’s new plant is expected to improve Europe’s resilience to potential future semiconductor shortages.

TSMC said the Dresden plant will be an important source of microcontrollers used in cars for windows, brakes and sensors.

“This is a win-win situation for all of us,” European Commission President Ursula von der Leyen said at a ceremony in Dresden.

German Chancellor Olaf Scholz said securing access to semiconductors was a “central issue” for his country, and German Economy Minister Robert Habeck added that the government would do everything possible to ensure that the project will be launched in 2027.

TSMC previously reported plans to build a third plant in the US state of Arizona. It was noted that the chips to be produced at the plant are critical for new technologies, including artificial intelligence and military needs.

Last year it was reported that the EU planned to invest more than 100 billion euros in chip production in its territory.