TAIPEI — Taiwan Semiconductor Manufacturing Co. (TSMC) said it aims to open its second fab in China earlier than originally expected in order to meet strong demand in the world’s fastest growing semiconductor market.
The company will “pull in” the opening of the fab located in Nanjing, China, to June of next year, according to TSMC Co-CEO Mark Liu, who was the keynote speaker at a company event to commemorate its outstanding ecosystem suppliers.
Two years ago, TSMC said it aimed to begin 16nm production at the fab in the second half of 2018. The planned capacity of TSMC’s wholly owned facility in China is 20,000 12-inch wafers per month on an investment of about $3 billion.
Competition in China’s foundry business is expected to grow as the nation accounts for an increasing portion of global demand, according to a report from market research firm IC Insights. Pure-play foundry sales in China are forecast to reach $7 billion in 2017, up 16 percent from 2016, according to IC Insights. China’s growth rate more than doubles that for worldwide foundry sales, the research firm noted.
TSMC is forecast to hold about 46 percent of the market for China's foundry revenue with sales of about $3.2 billion, up 10 percent from 2016, IC Insights said.
China is pushing hard to expand its domestic semiconductor production, with plans to invest more than $160 billion in the industry over the next decade. China’s government aims to build a domestic semiconductor industry to offset imports of chips that manufacturers in China use in the assembly of products such as the Apple iPhone and iPad.
A number of foundries such as Semiconductor Manufacturing International Corp. (SMIC) have opened in China in competition with TSMC and smaller rivals such as Globalfoundries and United Microelectronics Corp. (UMC). While TSMC prepares to start 16-nm production at the Nanjing fab, SMIC is still cutting its teeth on 28-nm technology.
In line with Taiwan government regulations, TSMC is keeping its most advanced process technologies, key production lines, and core R&D efforts in Taiwan, where the company plans to start production of 7nm chips next year.
TSMC held its 17th annual supply chain management forum to honor its top suppliers, particularly for their help with the ramp of TSMC’s 10nm production and technology development for 7nm and beyond. Over 600 suppliers around the world in equipment, materials, packaging and a range of services joined the forum.
“With the support of our supplier partners, TSMC has once again brought a new technology to volume production in record time with our 10nm capacity,” said TSMC Senior Vice President Steve Tso.
The company presented awards to 12 companies in the equipment and materials businesses as outstanding suppliers.
—Alan Patterson covers the semiconductor industry for EE Times. He is based in Taiwan.