TSMC's Chang to attend Nanjing plant ceremony

2017/09/11 14:25:07 fontsize-small fontsize-default fontsize-big
TSMC Chair Morris Chang

TSMC Chair Morris Chang

Taipei, Sept. 11 (CNA) Morris Chang, chairman of the world's largest contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電), will attend a ceremony for the installation of new production equipment at an under-development 12-inch wafer plant in Nanjing, China, on Sept. 12, TSMC confirmed Monday.

Analysts said the market has been closely watching the progress of construction work at the Nanjing plant, the first 12-inch wafer wholly owned by a Taiwanese firm in China, at a time when Beijing is gearing up to develop the local semiconductor industry.

Analysts added that Chang's attendance at the Tuesday ceremony demonstrates the importance of the Nanjing plant to TSMC, which the chip maker will use to target business opportunities in the growing China market.

The ceremony for new production equipment indicates that hardware at the Nanjing plant is almost complete, in preparation for mass production of chips manufactured using TSMC's 16 nanometer process planned for the second half of next year.

The Nanjing site will become the first wafer plant in China to adopt the 16nm process.

TSMC's latest technology to enter commercial production is the advanced 10 nanometer processor, while the chip maker is developing 7nm, 5nm and 3nm processes in a bid to maintain its lead over competitors in the global semiconductor market.

Construction of the Nanjing plant started on July 7, 2016 after Taiwan's Investment Commission approved an application filed by TSMC in February to invest about UT$3 billion in the 12-inch wafer plant, located in Nanjing's Pukou Economic Development Zone.

With the authorities in Nanjing promising to provide investment incentives to encourage TSMC to build the 12-inch wafer plant there and the chip maker moving existing production equipment from Taiwan to the new plant, total new investment from TSMC is expected to fall below the planned US$3 billion, analysts said.

Analysts said that TSMC is eyeing China's booming smartphone chip market as well as the country's fast growing artificial intelligence business, with the new Nanjing plant expected to compete for orders in those areas.

TSMC is believed to supply the A11 process for production of the next generation of iPhones by Apple Inc. which is expected to debut later in the week. The market has high hopes that the launch of the new iPhone will boost the chip maker's shipments for the second half of this year.

In the wake of Apple's orders for production of the new iPhone, TSMC posted NT$91.92 billion (US$3.06 billion) in consolidated sales in August, up 28.4 percent from July, when the sales figure stood at NT$71.61 billion, which was down 14.9 percent from the previous month.

(By Jackson Chang and Frances Huang)

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