TSMC Approves $2.8 Billion for Capacity Expansion in Response to Global Chip Shortage

TSMC board has approved $2.89 billion (roughly Rs. 21,690 crores) in spending to increase capacity, the company said, responding to a global chip shortage that has affected carmakers in particular.

In a brief statement, the world's largest contract chipmaker said its board had approved the spending "for the purpose of installing mature technology capacity".

It did not elaborate.

The company this month said that it plans to invest $100 billion (roughly Rs. 7,50,300 crores) over the next three years to increase capacity at its plants, days after Intel announced a $20 billion (roughly Rs. 1,50,000 crores) plan to expand its capacity.

TSMC, clients of which include Apple and Qualcomm, has said it is working hard to increase productivity and alleviate the worldwide shortage but that supply tightness is likely to continue into next year.

The company has flagged "multiple years of growth opportunities" as the COVID-19 pandemic fuels demand for advanced chips to power devices such as smartphones and laptops.

But its business has also been boosted by the chip shortage that initially forced automakers to cut production but is now also hurting manufacturers of smartphones, laptops, and even household appliances.

© Thomson Reuters 2021

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