TSMC warns chip shortage will continue until 2022
TSMC warns chip shortage will continue until 2022

Taiwanese semiconductor manufacturer (TSMC) announced in its Q3 2021 financial report that it plans to expand its chip manufacturing business with a new plant in Japan, the latest expansion of the world's largest chip maker.

However, when the news broke, the company also warned that the supply of chips could be reduced in 2022 due to ongoing scarcity.

The new factory plans to focus on making chips using legacy technology rather than the high-end processors TSMC is known to supply to companies like Apple, Nvidia, Qualcomm and AMD.

This is important because older chips, such as those used to control airbags and seat belts in cars, or power management chips for iPhones, face the biggest supply problems.

There is still plenty of time for the new plant to be operational, as production will not start until the end of 2024.

TSMC is finalizing plans for a new plant. The company said the new Japanese plant had not yet been approved by the TSMC board of directors.

TSMC warned in April that the shortage could continue into 2022.

Intel CEO Pat Gelsinger has also expressed concerns about supply in 2022. He said in July that it would take a year or two for the shortage to end.

AMD president Lisa Sue is more optimistic, but she also indicated that at least the show could become scarce in the first half of the year.

TSMC is building a new chip plant in Japan

TSMC has also been reported to increase the price of its high-end semiconductor products by about 10%. In addition, the price of less advanced products increased by 20%. The important point is to reduce demand and finance planned investments.

Investing in increasing production capacity to meet growing demand and avoid future bottlenecks is a top priority for the company.

TSMC has announced that it will invest $100 billion by 2023 to increase its manufacturing capabilities. These include plans to invest $12 billion in a new Japanese manufacturing center and factory in Arizona.

TSMC said net income for the July-September period was $5.56 billion. Revenue rose 22.6 percent to $14.88 billion in the second quarter.

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