10,000 Million Euros: Semiconductor Manufacturer TSMC Invests in Dresden

August, 2023: The globally active Taiwanese semiconductor manufacturer TSMC has announced its intention to build a wafer factory in Saxony's state capital Dresden together with Bosch, Infineon and NXP.

TSMC Fab 6 Taiwan (Source: TSMC)

TSMC, Robert Bosch GmbH, Infineon Technologies AG and NXP Semiconductors N.V. announced they will jointly invest in the European Semiconductor Manufacturing Company (ESMC) GmbH in Dresden, Germany, to provide advanced semiconductor manufacturing services. ESMC is an important step towards establishing a 300mm manufacturing facility to meet the future capacity needs of the fast-growing automotive and industrial sectors. However, the final investment decision is still subject to confirmation of the level of public funding under the European Chips Act for this project. 

"This investment in Dresden demonstrates TSMC’s commitment to serving our customers’ strategic capacity and technology needs, and we are excited at this opportunity to deepen our long-standing partnership with Bosch, Infineon, and NXP,” said Dr. CC Wei, Chief Executive Officer of TSMC. “Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields, and we look forward to bringing those innovations to life on our advanced silicon technology with the talent in Europe."

Saxony's Minister President Michael Kretschmer is pleased: "Today's decision for Dresden is a big win and wonderful news for Saxony, Germany and all of Europe."

Thomas Horn, Managing Director of the Saxony Trade & Invest Corp., added: "The location of TSMC is the largest single investment by a company in the history of the Free State of Saxony. TSMC's decision will also give us a strong tailwind to attract further new settlements and expansion investments for Saxony, which can further strengthen the already existing very efficient supplier network. This benefits the entire industry and will then in turn also be a magnet for attracting skilled workers to the location with numerous attractive job offers."

The planned fab is expected to have a monthly production capacity of 40,000 300mm (12-inch) wafers on TSMC’s 28/22 nanometer planar CMOS and 16/12 nanometer FinFET process technology, further strengthening Europe’s semiconductor manufacturing ecosystem with advanced FinFET transistor technology and creating about 2,000 direct high-tech professional jobs. ESMC aims to begin construction of the fab in the second half of 2024 with production targeted to begin by the end of 2027.

The planned joint venture will be 70% owned by TSMC, with Bosch, Infineon, and NXP each holding 10% equity stake, subject to regulatory approvals and other conditions. Total investments are expected to exceed 10 billion euros consisting of equity injection, debt borrowing, and strong support from the European Union and German government. The fab will be operated by TSMC.