TSMC, "Investing 113 Trillion Won in Semiconductors Over 3 Years"... Intensifying Competition with Samsung (Comprehensive)

TSMC "Factory Utilization Rate Exceeded 100% Over the Past 12 Months"
Focusing on Expanding Semiconductor Production Capacity

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] Taiwanese foundry company TSMC announced that it will invest a total of $100 billion (approximately 112.76 trillion KRW) over the next three years to expand semiconductor production capacity. This is interpreted as a strategy to resolve the semiconductor supply shortage and maintain its number one market share in the foundry sector amid fierce competition with Samsung.

According to Bloomberg on the 1st, TSMC released a statement saying, "We will focus on expanding semiconductor production capacity and invest an additional $100 billion to lead process technology." Previously, TSMC had announced plans to invest $28 billion in semiconductors within this year.

This expansion plan by TSMC is understood to be due to the ongoing semiconductor supply shortage, making it difficult to meet customer demand. In a letter sent to customers, TSMC stated, "In December, the utilization rate of all factories exceeded 100%," and "Despite this, we are still unable to meet demand." Currently, TSMC counts major global IT companies such as Apple, Qualcomm, Nvidia, and AMD among its customers.

Additionally, TSMC emphasized that it is hiring thousands more employees and constructing new semiconductor factories.

This investment plan by TSMC is interpreted as a determination not to lose leadership in the foundry market amid intensifying competition with Samsung Electronics. According to the statistics agency Statista, as of the first quarter of this year, TSMC and Samsung Electronics hold the first and second positions in the foundry market with market shares of 56% and 18%, respectively. While TSMC is maintaining a stable number one position, Samsung Electronics has announced plans to invest $116 billion (approximately 131 trillion KRW) over the next decade to expand semiconductor production and develop process technology, prompting TSMC to respond in kind.

Following the COVID-19 pandemic, global automobile production increased due to economic recovery expectations, leading to explosive growth in demand for automotive semiconductors. However, starting last year, the surge in demand for IT devices combined with automotive semiconductor demand caused production bottlenecks and a semiconductor supply shortage.

Meanwhile, immediately after TSMC's announcement on the day, its stock price rose by about 2.3%.

This content was produced with the assistance of AI translation services.