New Fab Construction Further Consolidates TSMC's Leading Status in Tougher Competition

Taipei, Dec. 13, 2011 (CENS)--Taiwan Semiconductor Manufacturing Co. Chairman and Chief Executive Officer (CEO) Morris Chang said he is confident that the company will ultimately retain the crown of the silicon foundry industry in spite of a tougher competition involving aggressive entrant Samsung.

Chang made the statement a few days ago, when he led the ground-breaking ceremony for the construction of the third production line of the company's mega factory Fab 15. He said Samsung is a “formidable” competitor.

This new production line, set to start operation in mid-2013, is designed to start volume production with 20nm process technology or more advanced.

Fab 15, calling for total capital expenditure of over NT$300 billion (US$10 billion at US$1:NT$30), is TSMC's pivotal facility for developing sub-20nm process technologies, which are intended to pull TSMC further ahead of its competitors, including Samsung, in the race.

Also attending the ceremony, National Science Council (NSC) Minister L.C. Lee pointed out that his organization will readily offer 50 hectares of land needed for the TSMC's new factory in the Central Taiwan Science Park, which is regulated by the Cabinet-level council.

Chang estimated Fab 15 to generate around US$6 billion in annual revenue for the science park and create 8,000 jobs when the its fourth production line is completed.

When speaking of his perspective of global economic outlook, Chang said over the next two months he will maintain the forecast he issued in November that global economy would not rally at least over the next one to two years. However, he felt that the ongoing slowdown is not as harsh to the semiconductor industry as the 2008 meltdown.

In November, the No.1 pure silicon foundry raked in consolidated revenue of NT$35.8 billion (US$1.19 billion), losing 4.7% from a month earlier and 2.7% from a year earlier. However, a 2.9% annual gain was registered by the company's total revenue for the first 11 months this year.

TSMC is company is estimated to have revenue of NT$103-105 billion (US$3.43-3.5 billion) in the fourth quarter, around 1-3% down from the previous quarter.

Chang estimated the brisk demands for smartphones and tablet PCs will remain the major driver of the company's revenue growth into 2012.