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TSMC to Build 12 Inch Fab in China

A

Arthur Hanson

Well-known member
This will be TSM's second fab in China and they have convinced China to let it be wholly owned for IP reasons. They plan to spend 3 billion on the fab. This is primarily designed to compete in the Chinese market and satisfy political considerations.
 
It is official:

Taiwan's TSMC signs deal to build $3 billion wafer plant in China
| Reuters

"With our 12-inch fab and our design service center in Nanjing, we aim to provide closer support to customers as well as expand our business opportunities in China in step with the rapid growth of the Chinese semiconductor market over the last several years," said TSMC Chairman Morris Chang in a statement. "We look forward to stronger collaboration with our customers to further expand our market share in China."

20,000 wafers per month is not a huge amount but it is a good start. I believe it will be 16FFC targeted at the China mobile market. Very bad news for SMIC by the way... SMIC will be struggling with first generation FinFET while TSMC has 99.99% yield on a low cost third generation.
 
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The Chinese government offer subsidies to Chinese companies fabricating chips locally, so if TSMC hadn't opened this fab they would have lost business to SMIC and UMC.
 
I think it is more important than that. From what I have been told it is a requirement for Chinese fabless companies to do business with approved Chinese manufacturers. This move puts TSMC on the approved list for all wafers and not just the ones made in China. Remember, this fab will only produce 20k wafers per month which is a fraction of China demand.

The Chinese government was also pressured into doing this since TSMC is the only company to make FinFETs for the mass market (16FFC). SMIC and UMC are YEARS away from their first generation FinFETs which will never catch TSMC with the price/performance curve. FinFETs really are a semiconductor game changer. Just my opinion of course.
 
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