TSMC plans Kaohsiung site expansion to boost semiconductor testing efficiency

Taiwan Semiconductor Manufacturing Co. (TSMC) is planning to expand its presence at the Baipu Industrial Park in Kaohsiung to speed up the testing and validation of semiconductor materials and equipment, a company executive said on Tuesday, according to Focus Taiwan.

As per the report, TSMC Vice President of Advanced Packaging Technology and Service Jun He said the company is working with Taiwan's Ministry of Economic Affairs and the Kaohsiung City government on the expansion, which is expected to boost validation efficiency by 25-50 per cent.

Apart from this, "TSMC will also undertake process R&D at the park, with plans to develop a world-class training hub for advanced packaging talent and connect local suppliers with global supply chains," Focus Taiwan noted.


He made the remarks at a global 3D IC summit held ahead of SEMICON Taiwan, which begins Wednesday.

According to He, TSMC is planning to develop a 3-hectare site at the Baipu Industrial Park featuring two buildings with modular facilities that can be reconfigured as technology evolves.

The site will house small cleanrooms and laboratories for testing and joint development of advanced packaging technologies, equipment and materials, as well as a training centre for highly skilled semiconductor process and equipment specialists, he said.

Also, the move comes as demand for advanced packaging has surged amid the rapid growth of artificial intelligence applications, He said.

Given that demand, TSMC expects its CoWoS advanced packaging capacity to grow at a compound annual growth rate of more than 80 percent through 2027, with strong growth expected to continue through 2029, He said, as reported by Focus Taiwan.

Earlier, in a separate development, TSMC approved a capital budget of about USD 29.44 billion to support expansion amid the ongoing artificial intelligence boom.

According to the contract chipmaker, the budget will be used for a range of requirements, including installing advanced technology capacity and constructing new fabrication facilities.

The approval comes after an investor conference in mid-July, where TSMC raised its 2026 capital expenditure forecast to USD 60 billion- USD 64 billion, up from its earlier estimate of USD 52 billion-USD 56 billion announced in mid-April.

At the July conference, TSMC cited strong global demand for 5G, AI applications and high-performance computing devices as key drivers behind the higher spending outlook.