TSMC doubles down on Taiwan as U.S.–Taiwan tariffs are finalized

With U.S.–Taiwan tariff terms now settled, foundry leader TSMC is continuing to expand investment in Taiwan, not only in advanced-node wafer fabs but also with aggressive capital deployment in advanced packaging (AP).

According to supply-chain sources, TSMC plans to invest in a total of four additional advanced packaging fabs this year, split between Southern Taiwan Science Park (STSP) and Chiayi. The company’s commitment to expanding back-end capacity in Taiwan is expected to be formally announced next week by Senior Vice President and Co-Chief Operating Officer Hou Yong-Ching.

Current and planned AP footprint:

• Chiayi Science Park (Phase 1):

  • P1: On track for mass production in the first half of the year

  • P2: Construction completed; tool installation underway

• Chiayi Phase 2: Two additional advanced packaging fabs planned

• STSP Phase 3: Two more advanced packaging fabs to be built

As AI and HPC demand push packaging complexity beyond the limits of traditional scaling, advanced packaging has become a core capacity bottleneck. TSMC’s decision to anchor this expansion in Taiwan underscores where the talent density, ecosystem readiness, and execution speed still reside.

This is not just capacity expansion—it’s a clear signal that Taiwan remains the strategic center of gravity for advanced semiconductor manufacturing, even as global diversification continues.