European TSMC chip factory talks reportedly collapse

European Commissioner for the Internal Market Thierry Breton speaking at the European Parliament in January 2020
European Commissioner for the Internal Market Thierry Breton (Image credit: Shutterstock)

Discussions regarding the building of a TSMC semiconductor manufacturing plant in Europe have reportedly collapsed, according to sources close to the matter.

European Commissioner for Internal Market Thierry Breton had been in talks with the Taiwanese tech giant about opening a factory in the region in efforts to remedy the impact of the global semiconductor shortage on the continent. The EU’s share of global semiconductor production is currently at 9%, with Breton seeking to increase it to 20% by 2030.

However, according to information given to Reuters by an anonymous source, talks have gone "very poorly”, and TSMC has now diverted its attention to the US where some of its biggest customers, including Apple, are headquartered. It's believed North America is responsible for 67% of TSMC’s sales, compared to 6% in the EMEA region.

This is despite Taiwanese president Tsai Ing-wen stating earlier this week that the country will cooperate with the EU to ensure a more "resilient supply" of semiconductors. Tsai also called for Taiwan and the EU to restart the stalled talks for a bilateral investment agreement (BIA) between the two regions.

"A BIA would not just help secure our supply chains; it would protect our mutual geopolitical and economic interests, and send a message about the partnerships and values on which our interests depend,” she said on Monday.

However, a TSMC spokeswoman has now told Reuters that the company doesn’t have any plans for a plant in Europe.

The faltering discussions between TSMC and the EU could mean that the European Commission would have to shift its attention to Dutch semiconductor companies ASML, NXL, or US firm Intel. Late last month, Breton met with the latter tech giant’s CEO Pat Gelsinger, who is seeking roughly €8 billion (£6.9bn) in subsidies in exchange for a European manufacturing plant.

"What we're asking from both the US and the European governments is to make it competitive for us to do it here compared to in Asia," Gelsinger told Politico in an interview.

Sabina Weston

Having only graduated from City University in 2019, Sabina has already demonstrated her abilities as a keen writer and effective journalist. Currently a content writer for Drapers, Sabina spent a number of years writing for ITPro, specialising in networking and telecommunications, as well as charting the efforts of technology companies to improve their inclusion and diversity strategies, a topic close to her heart.

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