It is clear that Europe, which has been left behind in the semiconductor war between China and the US, wants to make up for lost time and that is why it is tempting the big chip producers in the world. Especially Intel and TSMC, which would be an economic plus.
In the specific case of TSMC, its expansion has been due to the problems of shortage in the production of chips. This has had the domino effect of forcing production levels to be cut at car manufacturing plants that make use of these components, as well as the market for smartphone devices and derivatives and PC hardware.
TSMC is eyeing Germany, but nothing is decided
TSMC’s interest in building a factory in Germany may come as a surprise to many, but with the advent of smart cars the industry’s big brands have ramped up their R&D to develop hardware designs in-house. Considering that the Teutonic country is one of the most powerful in that market and that they require large quantities of chips it makes sense for TSMC to deploy a plant in that country. The rest of the automotive industries in the European Union, such as France, Italy and Spain, also benefit from it.
In any case, according to the words of TSMC President Mark Liu at its annual investor conference, Germany is not entirely decided.
We will continue to communicate with our major customers in Germany to see what is most important and effective for our customers, it is too early to say anything.
We don’t know which manufacturing node TSMC would propose in that market, but since we would be talking about semi-custom designs it is possible that TSMC will not deploy a 5nm node in Europe as it will in the US. Which makes sense if we take into account the needs of each market. In the case of Germany and the rest of the European Union it would be very beneficial for them in terms of time and logistics costs to have the chip fab next door to home.
Could this result in the re-emergence of Europe as a semiconductor powerhouse?
The fact that Intel and TSMC are eyeing European soil to build fabs does not mean that Europe has caught up. It’s one thing to have the resources available to create a processor, but it’s quite another to have the resources to design them, which requires years of accumulated knowledge. Europe doesn’t seem to be interested in creating new designs that compete against the American giants in designing new processors such as Intel, AMD, Apple, NVIDIA, etc.
Incluso China is getting its act together developing CPU and GPU designs that can compete head to head against US designs, all fueled by a blockade war between countries. In which Europe as a satellite of the US has had no need to develop any technology of its own as it is part of the US commercial orbit.
If anything, TSMC’s interest in Germany seems to be about decongesting its main factories and giving European customers much shorter lead times than now. That would help improve its production.