SINGAPORE - Taiwan Semiconductor Manufacturing Company (TSMC) is considering building a new multibillion-dollar factory in Singapore to help tackle the global chip shortage, the Wall Street Journal reported on Thursday (May 19).
Negotiations are under way with the Economic Development Board (EDB), according to WSJ, citing unnamed sources. It said no final decision has been made.
The report added that the Singapore Government may help to fund construction of the plant.
Responding to queries from The Straits Times on Friday, an EDB spokesman said that it does not disclose details of project discussions with companies, if any, as they are private and confidential.
Taiwan chip giant TSMC told ST: "TSMC does not rule out any possibility; however, the company does not have a concrete plan at this time to build a fab in Singapore."
TSMC is the world's largest contract chipmaker and earns about a quarter of its revenue from Apple.
The potential Singapore plant could manufacture processors of between 7-nanometer (nm) and 28nm, which are based on older production technologies, the WSJ report said.
These are chips used in some smartphones but more widely seen in cars and other devices, according to AppleInsider. TSMC is ramping up investment in these chips, which have seen some of the worst supply chain bottlenecks.
The Singapore factory could thus free up production capacity at other plants where Apple's latest 5nm chips can be manufactured and help to relieve global shortages, according to a report in MacRumors.
No specific location or budget estimate for the potential Singapore plant was given in the WSJ report. TSMC has said that it plans to spend between US$40 billion (S$55 billion) and US$44 billion for its overall capital expenditure in the current financial year.
TSMC's main factories are located in Taiwan, but it also operates a factory in Washington and is building its first Japanese plant as a joint venture with Sony and a US$12 billion 5nm chip plant in Arizona.
Its expansion plans come against a backdrop of major economies - from the United States to Europe, Japan and China - rolling out billions in incentives to bring semiconductor production onshore due to supply chain issues and national security concerns.
US-listed Globalfoundries, the world's third-biggest contract chipmaker, announced last year a US$4 billion investment plan to build another plant in Singapore. Its investment is in partnership with EDB, with co-investments from customers.