Taiwan Semiconductor Manufacturing Company (TSMC) hopes to quickly increase chip packaging capacity amid strong demand from the artificial intelligence industry, but its efforts have been setback after potential archaeological sites were discovered at the site of a new factory. TSMC plans to build two chip-on-wafer (CoWoS) packaging plants in Chiayi, Taiwan, and Taiwanese media quoted social media reports as saying that National Taiwan University is recruiting trained archaeological excavation personnel.
TSMC plans to build two CoWoS packaging plants in Chiayi, and a government statement earlier this year indicated that the first plant will be completed in 2026 and put into production in 2028.
Taiwanese media recently reported that TSMC encountered setbacks when it discovered obvious archaeological remains at the site when digging new packaging facilities to expand its AI chip production capacity. TSMC’s packaging facilities in Chiayi, Taiwan were announced in early March this year by former Executive Yuan Vice President Zheng Wencan.
The facilities will be built within the Chiayi Science Park, with the first factory set to be completed in 2026. Now, media reports suggest that construction workers at the excavation site may have stumbled upon archaeological remains in the area, according to Taiwanese media. Since removing any such remains would be tricky and beyond the capabilities of ordinary construction workers, the report added that National Taiwan University is "urgently recruiting" people trained in such operations.
While the alleged remains found in Chiayi may not cause any disruption to TSMC's long-term plans to increase packaging capacity, the company may have to make temporary adjustments, according to industry sources. This may include temporarily relocating the factory, with one possible location being an old factory building in Taichung.
Surge in global demand for artificial intelligence chips, which require advanced packaging technology to achieve peak performance, has forced TSMC to expand its operations. While the company previously offered backend packages as part of a wider service, they are now an equally important part of its portfolio.
It is expected that TSMC's packaging production capacity will increase to 32,000 pieces per month by the end of 2024, 50,000 to 55,000 pieces per month in 2025, and 65,000 pieces per month in 2026. Wall Street's artificial intelligence darling NVIDIA and its smaller rival AMD are also customers of TSMC's packaging products.