SAN JOSE, Calif. -- Silicon foundry giant Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) has approved a $1.647 billion capital spending program, including plans to build a new fab in central Taiwan.
As part of the plan, TSMC approved capital appropriations of $1,051,600 to expand its advanced process capacity at two 300-mm plants in Taiwan, dubbed Fab 12 and Fab 14.
The company also approved capital appropriations of $385 million to expand and upgrade its 200-mm wafer capacity. And as expected, it approved capital appropriations of $210 million to build Fab 15 in the Central Taiwan Science Park.
In total, TSMC is expected to spend $4.8 billion this year. In fact, many foundry vendors are engaged in a capital spending war or "arms race," said C.J. Muse, an analyst with the Barclays Capital, in a new report.
Three vendors--GlobalFoundries, Samsung and TSMC-- appear to be engaged in a new capital spending race in an effort to gain share in current and future cycles. The trends could be a problem for the other digital foundries, such as SMIC, UMC and others, many of which cannot keep up with the spending race and will likely fall behind the curve.