TSMC says it has discussed moving fabs out of Taiwan, but such a move impossible

Taiwanese contract chipmaker TSMC has held talks with its customers about whether to move its fabrication plants off the island.
| Photo Credit: Reuters

Taiwanese contract chipmaker TSMC has held talks with its customers about whether to move its fabrication plants off the island amid increased tensions with China, although such a move would be impossible, a senior executive said on Tuesday.

Speaking to reporters after the company’s annual shareholder meeting in Hsinchu, where TSMC is headquartered, Chairman C.C. Wei said that given 80%-90% of its production capacity is in Taiwan, it would be impossible to move the factories.

“Unstability across the Taiwan Straits is indeed a consideration for supply chain, but I want to say that we certainly do not want wars to happen,” Wei told reporters after the company’s annual general meeting.

Taiwan’s defence ministry said on Tuesday it had detected another Chinese “joint combat readiness patrol” with 23 warplanes operating near Taiwan, as well as warships.

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Increasing tensions between China and Taiwan was among the major topics discussed at the annual Computex technology trade show this week in Taipei, and some Taiwanese chipmakers sought to play down the geopolitical risks.

“Nobody is worried about this yet,” Frank Huang, chairman of Powerchip Semiconductor Manufacturing, told reporters at the event, when asked whether foreign customers were putting pressure on Taiwan firms not to produce there given the tensions.

“I think of course always there is military activity, or showdowns, but again Taiwan is so important to AI – even the Chinese know that. We are OK, no problem,” he said.

Advanced Micro Devices Chief Executive Lisa Su also reiterated the importance of Taiwan in the global chip supply chain, when asked about how tensions with China and its war games could affect the industry.

“We do a lot of our manufacturing here with key suppliers like TSMC… And then we also have a number of partners that help us build out the ecosystem here in Taiwan,” she told reporters at the show on Monday. “The bottom line from our perspective is it’s really important to have a global ecosystem.”

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