TSMC announced this afternoon that it will expand its mature and dedicated node production capacity by approximately 50% by 2025. The plan includes the construction of numerous new factories in Taiwan, Japan and China. The move will further intensify competition between TSMC and chip contract makers such as GlobalFoundries, UMC and SMIC.
Here at AnandTech, when we talk about silicon lithography, we usually talk about advanced nodes used to produce advanced CPUs, GPUs and mobile SoCs, as these are devices that drive progress. But there are hundreds of device types built on mature or specialized process technologies that run alongside those advanced processors, or power emerging smart devices that are having a significant impact on our daily lives and have gained importance in recent years. Demand for various computers and smart devices has exploded in recent years, leading to a global chip supply crisis, which in turn has impacted the automotive, consumer electronics, PC and numerous neighboring industries. .
Modern smartphones, smart home appliances and PCs already use dozens of chips and sensors, and the number (and complexity) of these chips is only increasing. These components use more advanced dedicated nodes, which is one of the reasons why companies like TSMC will need to expand their production capacity from otherwise “old” nodes to meet growing demand in the coming years.
But there is another market that is about to explode: smart cars. Cars already use hundreds of chips and the share of semiconductors for vehicles is growing. There are estimates that in a number of years the number of chips per car will be around 1,500 units – and someone will have to make them. Therefore, TSMC rivals GlobalFoundries and SMIC have invested more in new capabilities in recent years.
TSMC, which has one of the largest CapEx budgets in the semiconductor industry (challenged only by Samsung), has been relatively quiet in recent years about their mature and dedicated node production plans. But at their TSMC Technology Symposium in 2022, the company formally outlined its plans.
The company is investing in four new facilities for mature and specialized nodes:
- Fab 23 Phase 1 in Kumamoto, Japan. This semiconductor manufacturing facility will make chips using TSMC’s N12, N16, N22 and N28 nodes and will have a production capacity of up to 45,000 300mm wafer starts per month.
- Fab 14 Phase 8 in Tainan, Taiwan.
- Fab 22 Phase 2 in Kaohsiung, Taiwan.
- Fab 16 Phase 1B in Nanjing, China. TSMC is currently making chips on its N28 in China, although it was rumored that the new phase would be able to make chips using more advanced nodes.
Increasing mature/specialized capacity by 50% over the next three years is a major shift for the company and one that will improve TSMC’s competitive position in the market. Perhaps more importantly, the company’s dedicated nodes are largely based on the common nodes, allowing at least some companies to reuse IP they once developed for computing power or RF for a new application.
†[Our] specialized technology is quite unique because it is based on a common technology platform [logic technology platform]so our unique strategy is to enable our customers to do a lot of the [common] IP,” said Kevin Zhang, senior vice president of business development at TSMC. “For example, you have RF capabilities, you build that RF on a common logical platform, but later you find out that someone needs what’s called a ULV function to run an IoT. -support product application.’ You want to build that on a common platform so that you can have different product lines share IP across the board. This is very important to our customers, so we want to provide an integrated platform to meet the market needs of customers from a product perspective.”
There are also other benefits. For example, TSMC’s N6RF allows chip designers to combine high-performance logic with RF, enabling them to build products such as modems and other more unique solutions. Many companies are already familiar with TSMC’s N6 logic node, so now they have the opportunity to add RF connectivity to something that benefits from high performance. GlobalFoundries takes a similar approach, but since the US-based foundry has nothing quite comparable to TSMC’s N6, TSMC has an undeniable advantage here.
With its common platform approach for both mature nodes and specialized technologies, and 50% more capacity, TSMC will be able to provide the world with more chips for smart and connected devices in the coming years. In addition, it will also benefit TSMC by significantly increasing the company’s revenues from mature and specialized nodes, as well as increasing pressure on their rivals.