By Mauro Orru 
 

The world's largest contract chip maker, Taiwan Semiconductor Manufacturing Co., set out plans to build a factory in the German city of Dresden with investments of more than 10 billion euros ($11 billion) as part of a joint venture with European companies. This is the latest big-ticket investment in Europe as Brussels seeks to become more self-sufficient in the production of semiconductors.

TSMC said Tuesday that it had agreed to create a joint venture with Infineon Technologies, Robert Bosch and NXP Semiconductors, and develop a chip factory to meet demand in the fast-growing automotive and industrial sectors. The total investments of more than EUR10 billion include equity injections, debt borrowing, and support from the European Union and German government.

TSMC said its board of directors had approved an equity investment of up to EUR3.50 billion in the joint venture, though the final investment decision for the project will hinge on the level of public funding, TSMC said.

"Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields," said TSMC Chief Executive C.C. Wei.

TSMC will own 70% of the joint venture, dubbed European Semiconductor Manufacturing Co., with the three European companies retaining 10% stakes. The Taiwan-based group will operate the plant, with construction expected to start in the second half of 2024, and production beginning by the end of 2027. The planned facility is expected to create some 2,000 high-tech professional jobs.

The announcement comes just two months after Intel reached an agreement with Berlin to invest more than EUR30 billion in two semiconductor facilities in the country. Intel is also planning a new semiconductor assembly and testing facility in Poland for an investment of up to $4.6 billion, building its presence in the country, which already hosts its largest research-and-development facility in Europe with nearly 4,000 workers.

 

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

 

(END) Dow Jones Newswires

August 08, 2023 07:17 ET (11:17 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.
Taiwan Semiconductor Man... (NYSE:TSM)
Historical Stock Chart
From Mar 2024 to Apr 2024 Click Here for more Taiwan Semiconductor Man... Charts.
Taiwan Semiconductor Man... (NYSE:TSM)
Historical Stock Chart
From Apr 2023 to Apr 2024 Click Here for more Taiwan Semiconductor Man... Charts.