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TSMC is building a $20 billion facility to keep Apple as a customer

Posted: , by Kaloyan C. Kaloyan C.

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TSMC is building a $20 billion facility to keep Apple as a customer

The Taiwan Semiconductor Manufacturing Company might not exactly be a household name, but it is one of the bigger players in smartphone component manufacturing. While companies like Qualcomm, MediaTek and Apple design their own chipsets, TSMC is the one that actually manufactures them.

But there are other players in the field, too — Samsung Semiconductor and Intel are two of the bigger ones — which necessitates the near-constant need to improve and innovate upon the manufacturing process. Thus, TSMC has already laid out its roadmap all the way to 2022, when it plans to have a 3nm semiconductor production line ready for use.

Current high-end chips use a 10nm process, so this will be more than a threefold reduction in semiconductor size. The end result will be chips that are both more powerful and less power-hungry, which is always a welcome change even for the most casual of smartphone users.

But in order to produce its own a 3nm process, TSMC needs to build a plant entirely dedicated to it. And while some reports have suggested the company may be looking into building a manufacturing facility in the United States, it won't be the one dedicated to the 3nm process —  that one will be located in TSMC's home country of Taiwan.

But it certainly won't be cheap: in an interview with Bloomberg, chairman and founder Morris Chang has revealed an estimate for the price of building such a facility: $20 billion. To put this into context, this figure is pretty close to the yearly GDP of countries like Cyprus and Cambodia, making this quite an impressive figure, even if it's for the company's most technologically advanced plant ever.

Apple's latest A11 Bionic is 100% produced by TSMC

Apple's latest A11 Bionic is 100% produced by TSMC


And judging from the outside, it certainly seems like Apple has a lot to do with this decision. TSMC has been the sole supplier of Apple chipsets for several years now, making Cupertino theis single largest customer. And we've already seen that companies that get suddenly abandoned by Apple don't do particularly good, so it isn't that far-fetched to say that this new plant is a bid to keep Apple close.

But if 2022 seems too far away from now, there's at least two more generations to go through — 7nm and 5nm. The former is expected to pop up in consumers' hands starting next year, while 5nm will begin production in 2019-2020. Or in other words — don't worry, there's still something to look forward to next year.

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