May 11, 2010 – Chip foundry giant Taiwan Semiconductor Manufacturing Co. (TSMC) says its board of directors have approved three proposed investments in fab infrastructure:
- $1.05B: To expand advanced process capacity at Fabs 12 and 14.
- $210M: To build Fab 15 in the Central Taiwan Science Park.
- $385M: To expand and upgrade 200mm wafer fab capacity.
(The board also approved full conversion of TSMC’s common shares into paperless forms by mid-July of this year.)
The Fab 15 "gigafab" — a project that’s been a decade in the making — will start groundbreaking in the middle of 2010 (construction taking at least a year), meaning it will probably not enter production until 2012, according to chairman/CEO Morris Chang, in the company’s recent 1Q10 conference call with analysts. It will start with 40nm production, and expand to 28nm, then 20nm, etc. Adding capacity at Fab 12 (Phase 5) and Fab 14 (Phase 4), meanwhile, will boost their output to 100,000 300mm-wafers/month.
Despite the new investments, TSMC says it will hold its proposed 2010 capex steady at around $4.8B, though some reports suggests a nudge up is imminent. FBR Research’s Mehdi Hosseini explains the no-capex-raise position thusly: leadtimes for litho tools (especially immersion) are stretched to nine months, so any 2010 capex increase won’t improve the current capacity shortage, which sits at 30%-40% of demand at leading-edge nodes, according to one report (and it is solely a capacity crunch, not an end-demand problem, he emphasizes). And also, keeping a cap on capex prevents the kind of excess capacity build that is toxic to the industry. (TSMC reportedly is also keeping an eye on possible oversupplies building due to doublebookings, demanding that IC design houses take delivery of ordered wafer starts before asking for more, according to Digitimes.)