[Taiwan Chip Report] TSMC Moves Quickly to Begin Construction of 1.4nm Plant

Investing 70 Trillion Won in a New 1.4nm Plant
Mass Production Targeted for 2028, Annual Sales Expected to Reach 24 Trillion Won

TSMC, the world's largest foundry (semiconductor contract manufacturing) company based in Taiwan, has begun construction of a new plant that will utilize the 1.4nm (1nm = one billionth of a meter) process. The subsequent bidding procedures for the plant's construction are also progressing rapidly.

According to local media such as Taiwan Economic Daily News, TSMC started groundwork for its new 1.4nm process plant at the Central Taiwan Science Park on November 5. TSMC has confirmed, "The new plant within the Central Taiwan Science Park has broken ground." The total investment for the project is expected to reach 1.5 trillion New Taiwan dollars (approximately 70.725 trillion won), with trial production scheduled for the end of 2027 and mass production targeted for 2028. If the plant operates as planned, annual sales are projected to exceed 500 billion New Taiwan dollars (about 23.57 trillion won).

A TSMC representative explained, "The second-phase expansion project at the Central Taiwan Science Park will introduce the advanced 1.4nm process," adding, "The project is proceeding smoothly as scheduled, as we had announced construction would begin this year."

At the North America Technology Forum in April this year, TSMC announced its production base plans, revealing that the second-phase expansion project at the Central Taiwan Science Park, named 'Fab 25,' will house four 1.4nm wafer fabs (plants). Industry insiders expect that if the first fab begins mass production of wafers in 2028, the initial monthly output will be around 50,000 units.

On October 17, TSMC completed its construction notification to the management bureau, which confirmed, "During the site briefing, TSMC changed its original plan to introduce the 2nm process to the 1.4nm or even more advanced process."

Within and outside TSMC's supply chain, there are reports that the United States is urgently demanding the securing of the 2nm process as part of efforts to diversify geopolitical risks. Industry sources also predict that, due to delays in the development of the Southern Taiwan Science Park, the application of the 1nm-class process at the Central Taiwan Science Park could be implemented earlier than initially planned.

The Central Taiwan Science Park recorded sales of 1.04 trillion New Taiwan dollars (about 49.04 trillion won) last year. This marks a 10.2% increase from the previous year and is the third-highest figure on record. Like the Hsinchu Science Park, the Central Taiwan Science Park is one of the three major national-level science parks established by the Taiwanese government and serves as a high-tech industry cluster, including semiconductors. Of the six major industries within the park, semiconductor sales-TSMC's main focus-reached 845 billion New Taiwan dollars (about 39.85 trillion won), accounting for 81.7% of the total.

With the boom in artificial intelligence (AI) expanding demand for semiconductors and related products, TSMC's expansion at the Central Taiwan Science Park is also accelerating the entry of supply chain companies. So far, 17 semiconductor-related companies have received approval to move in, and it is expected that if the second-phase expansion project gains full momentum, semiconductor-related sales alone will surpass the trillion-won mark.

Taiwan Economic Daily News = Song Jiansheng, Yin Huizhong / Translation = The Asia Business Daily

*This column is published as part of a strategic partnership between The Asia Business Daily and Taiwan Economic Daily News.