Taiwan Semiconductor Manufacturing Co. TSM reaffirmed Thursday that construction of its second advanced packaging plant in Chiayi County remains on schedule, countering reports that the project had been suspended and its equipment diverted to the U.S.
Last year, construction began on the Chiayi facility, one of two advanced packaging plants being built at the Southern Taiwan Science Park’s campus in Taibao City, the Taipei Times reported.
Designed to employ chip-on-wafer-on-substrate technology, the site was initially scheduled for completion in 2026, with mass production targeted for 2028.
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The expansion underscores Taiwan Semiconductor’s strategy to capitalize on soaring AI-driven demand, a trend that has propelled its stock more than 36% year-to-date, outpacing the Nasdaq 100’s 16% gain.
As the primary chip supplier to Nvidia NVDA and Apple AAPL, Taiwan Semiconductor sits at the center of the AI supply chain while managing a complex balancing act between its core operations in Taiwan and a growing overseas footprint.
The company is simultaneously building fabrication and packaging capacity in Arizona and Texas, expanding in Japan, and establishing a presence in Dresden, Germany.
In the U.S., Taiwan Semiconductor has committed $65 billion to advanced fabrication plants in Arizona and pledged more than $17 billion toward cutting-edge chips and packaging, part of a broader plan to anchor a global AI chip alliance.
Beyond that, it has outlined another $100 billion in planned U.S. investments, spanning three wafer fabs, two packaging plants, and a research and development hub.
These moves come against a charged political backdrop. Reports have suggested that U.S. pressure, particularly from President Donald Trump’s administration, played a role in accelerating Taiwan Semiconductor’s American buildout as Washington sought to reduce reliance on China-linked supply chains.
Beijing, in turn, has accused Taipei of “surrendering” its semiconductor industry in exchange for political and military backing from Washington. Trump himself has criticized Taiwan for allegedly undermining U.S. chipmaking, pledging retaliatory tariffs tied to Taiwan’s trade surplus.
Taiwan has sought to navigate these tensions by reinforcing trade and defense ties with Washington, while also signaling flexibility in allowing advanced chip production outside China.
The government’s approvals have enabled Taiwan Semiconductor to pursue overseas investments that align with U.S. strategic goals, even as some reports suggest its Japan initiatives are being stretched thin by the scale of its American commitments.
Price Action: TSM stock is trading lower by 1.12% to $265.65 premarket at last check Friday.
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