Overseas OEMs TSMC and Power Semiconductor are facing difficulties: costs have increased by 2.5-4 times, and they need to wait 7-8 years to make money.

Companies such as Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC), Power Semiconductor Manufacturing Co., Ltd. (PSMC) and United Microelectronics Corp. (UMC) play an important role in the active development of the semiconductor industry in countries around the world. They are key cooperation partners for various countries.

According to the latest report from TrendForce, Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC) and Power Semiconductor Manufacturing Co., Ltd. (PSMC) have encountered challenges in overseas foundry, and their costs will increase. Soared 2.5 to 4 times.

Huang Chongren, chairman of Power Semiconductor Manufacturing Co., Ltd., said that it has received invitations from 7 to 8 countries and hopes to build semiconductor wafer factories in these countries. However, they also realize that setting up factories in these countries and regions will face high costs.

Huang Chongren said that the cost of building a wafer fab in Japan is 1.5 times that of Taiwan, of which the construction cost is 2.5 times and the operating cost is 50%.

According to reports, many countries, including Japan, Vietnam, Thailand, India, Saudi Arabia, France, Poland and Lithuania, hope to receive assistance from Power Semiconductor Manufacturing Co., Ltd. to jointly build wafer fabs.

If construction and operating costs are calculated, it will take 7-8 years to achieve profitability, that is, it will take 3 years after the factory is put into production to start making profits. In comparison, Power Semiconductor's P5 fab in Tongluo Science Park will break even this year.

In addition, TSMC has encountered similar challenges when expanding overseas. According to TSMC executives at a financial report meeting in early 2023, TSMC’s cost of building a factory in the United States has increased by at least four times due to factors such as labor costs, licenses, regulatory compliance, and rising living prices.

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