TSMC to Build Five Additional Advanced Packaging Plants in Taiwan

Expansion of Advanced Plants in Hsinchu Science Park and Tainan Area
Aimed at Addressing Concerns Over TSMC's Repositioning as "America's TSMC"

Taiwan's TSMC, the world's largest foundry (semiconductor contract manufacturing) company, is planning to build four additional advanced packaging (AP) plants, according to Taiwanese media including Liberty Times on January 19.

AP Yonhap News

According to sources, TSMC Senior Vice President and Co-Chief Operating Officer Hou Yongqing is scheduled to announce on January 22 the expansion of four additional advanced AP plants in the Hsinchu Science Park and the Tainan area of the Southern Taiwan Science Park.

The sources stated that TSMC will begin mass production at AP Plant 1 (P2) in the Hsinchu Science Park in the first half of this year, and will bring in equipment for Plant 2 (P2) during the same period.

They further added that TSMC has started production using the advanced packaging technology 'Chip on Wafer on Substrate (CoWoS)' at AP8, a facility converted from a plant previously owned by Innolux, a panel company under Taiwan's Foxconn Group that was acquired in 2024.

Some interpret this move as a preemptive measure to counter concerns that the expansion of U.S. plants due to CoWoS production shortages could undermine the 'silicon shield' (semiconductor defense) and potentially reposition Taiwan's TSMC as 'America's TSMC.'

Chinese-language media, including the Central News Agency, reported on January 17 that after the conclusion of mutual tariff negotiations between the United States and Taiwan, U.S. Secretary of Commerce Howard Lutnick recently stated in an interview that the goal is to bring 40% of Taiwan's entire (semiconductor) supply chain and production capacity to the United States.

In response, Taiwan's Minister of Economic Affairs Kung Ming-hsin estimated that, based on advanced processes of 5 nanometers (nm, one billionth of a meter) or below, the industrial capacity ratio between Taiwan and the United States will be 85% to 15% by 2030 and 80% to 20% by 2036.

On January 15, the United States and Taiwan agreed to lower the mutual tariff rate on Taiwanese goods to 15%. In addition, Taiwanese companies and the government have agreed to provide a total of $250 billion in direct investment and credit guarantees to the United States, respectively.