TSMC struggles to keep up with AI boom

台積電難以跟上AI熱潮的需求步伐

TAIPEI (Taiwan News) — TSMC is building nearly 20 chip fabrication plants but Senior Vice President and Deputy Co-COO Cliff Hou (侯永清) said the unprecedented growth in AI demand is outstripping the industry’s ability to expand capacity.

TSMC is building 13 fabs in Taiwan and another five or six overseas. Speaking at Semicon Taiwan on Wednesday, Hou said, “In my 30 years in the industry, I’ve never seen market demand grow this much or change this frequently,” per Rti.

Hou cited equipment demand as an example, saying TSMC’s estimate at the end of last year was later revised upward to 1.5 times the original equipment requirement and then to 1.9 times by July.

“We have never done this before,” Hou said, adding that even this expansion remains insufficient to fully meet market demand.

He said Taiwan is a major global center for semiconductor manufacturing and testing and has a responsibility to expand supply, Rti reported. At the same time, TSMC must work with partners worldwide to establish semiconductor ecosystems overseas.

The company is also facing a shortage of construction talent in both Taiwan and the US, Hou said. When demand nearly doubles over a short period, shortages of workers and other resources can become major bottlenecks throughout the supply chain.

He said the challenge extends beyond TSMC, with suppliers across the industry needing to accelerate capacity expansion while continuing to invest in research and development, according to Rti.