TSMC plans $US7.5bn chip plant investment in Taiwan

TSMC plans to invest US$7.5 billion in chip factories in central Taiwan, according to the government.

Taiwan Semiconductor Manufacturing, the world's largest contract chip maker, plans to spend $US7.5 billion on advanced chip factories in central Taiwan, according to the government.

The project will be huge, according to a news release from Taiwan's National Science Council, a government bureau that vets applications to reserve land in industrial parks on the island.

TSMC would begin construction on the proposed chip factories in 2007 with a goal to turn out 105,000 finished silicon wafers per month by the time it's finished, according to the release. An average 12-inch (300mm) chip plant produces about 35,000 wafers a month.

Chips are made on large, flat round silicon wafers about the size of dinner plates. Thousands of chips can be made on each wafer.

The proposal called for the factory to produce cutting edge chips, using 65-nanometer production technology initially and adding even more advanced 45-nanometer technology later on, the National Science Council said.

Nanometers are thousands of times thinner than a human hair, and are used to describe the tiny size transistors and other parts that are etched onto chips. In chips, the more transistors on board, the faster they perform tasks.

Officials at the company cautioned that the information submitted to the National Science Council was just a proposal, and could be changed. The application is meant to reserve land at an industrial park in central Taiwan.

TSMC has two other 12-inch chip factories in Taiwan that aren't running at full capacity yet, and other unused land that it would want to use up before starting construction on the proposed plants in central Taiwan, a spokesperson for TSMC, J.H. Tzeng, said.