Introduction
Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading contract chipmaker, has reportedly postponed the move-in of critical equipment at its advanced packaging facility AP7 in Chiayi, Taiwan.
The delay, according to sources cited by Economic Daily News and MoneyDJ, stems from recent workplace safety incidents that have paused construction activities.
This development raises questions about the timeline for expanding TSMC’s advanced packaging capacity—a key factor in supporting global high-performance computing (HPC) chip supply chains.
Brief Overview:
TSMC planned to move equipment into the AP7 facility in Q3 2025, now postponed to Q4.
Two workplace safety incidents at the Chiayi site have halted construction.
The delays may impact the global supply of HPC chips amid rising demand.
AP7’s first phase will focus on wafer-level multi-chip module (WMCM) packaging.
Industry insiders expect Apple to be the initial beneficiary of AP7’s hybrid InFO and CoWoS packaging technologies.
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Background: TSMC’s AP7 Facility Expansion
TSMC has been aggressively expanding its advanced packaging capabilities to keep pace with growing demand for more efficient, high-performance semiconductor solutions. The AP7 facility, located in Chiayi, southern Taiwan, plays a strategic role in this plan.
The facility targets advanced packaging technologies, including wafer-level multi-chip module (WMCM) packaging.
WMCM integrates multiple chips on a wafer before slicing, providing benefits like improved speed, power efficiency, and reduced footprint.
This hybrid packaging approach at AP7 combines TSMC’s InFO (Integrated Fan-Out) and CoWoS (Chip on Wafer on Substrate) technologies—two of the industry’s leading solutions for packaging high-density and high-performance chips.
Experts suggest this technology will soon be crucial in Apple’s chip strategy, enhancing performance in its in-house designs, as noted by Economic Daily News and MoneyDJ.
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Safety Incidents Trigger Construction Delays
Construction work at the Chiayi AP7 site has hit a snag. Taiwan’s Occupational Safety and Health Administration (OSHA) reported two separate workplace accidents:
- Forklift Accident: OSHA requires TSMC to implement a safety improvement plan and provide additional training before resuming work in the affected area.
- Scaffolding Incident: Work involving scaffolding has been suspended until corrective safety measures are enforced.
These incidents have led to a temporary halt in construction activities at specific sections of the site. Economic Daily News emphasizes that this pause has pushed back equipment move-in schedules initially planned for the third quarter of 2025 to the fourth quarter.
TSMC has not officially commented on these developments or confirmed any delays.
Potential Impact on Chip Supply Chain
TSMC’s AP7 facility expansion is critical to the supply chain of HPC chips, widely used in data centers, artificial intelligence, and other compute-intensive applications. Any delay in AP7’s ramp-up could ripple through the global semiconductor supply ecosystem.
Table: AP7 Timeline and Impact Summary
| Milestone | Original Schedule | Revised Schedule | Potential Impact |
|---|---|---|---|
| Equipment Move-In | Q3 2025 | Q4 2025 | Delay in advanced packaging capacity |
| Construction Suspension | Q2 2025 | Ongoing | Project timeline extension |
| Initial Production (WMCM tech) | Late 2025 | Early 2026 | Possible postponement of new packaging tech availability |
| Major Customers (e.g., Apple) | Late 2025 | Early 2026 | Delayed product integration cycles |
This delay comes amid strong global demand for advanced semiconductor packaging technologies, intensifying supply chain pressures worldwide.
Industry Insights and Outlook
TSMC’s advanced packaging expansion at AP7 represents a vital step in maintaining Taiwan’s leadership in semiconductor manufacturing. Advanced packaging techniques like WMCM enhance chip performance by integrating multiple dies with improved interconnectivity and thermal management.
Industry experts view the delay as a temporary setback rather than a critical threat. TSMC’s stringent focus on workplace safety, though causing short-term disruption, ultimately strengthens operational resilience.
Moreover, Apple’s anticipated use of AP7’s hybrid InFO and CoWoS packaging signals continued close collaboration between the two tech giants, which will likely accelerate as the new facility becomes operational.
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Conclusion
TSMC’s AP7 advanced packaging facility in Chiayi faces a brief delay in equipment installation caused by workplace safety incidents. While this pushes back the timeline from Q3 to Q4 2025, the facility’s strategic role in next-generation chip packaging remains intact. The industry continues to watch closely, given the facility’s significance to HPC chip supply chains and Apple’s future chip production.
TSMC’s handling of the safety issues reflects the company’s commitment to both operational excellence and employee well-being. As the company addresses these challenges, the semiconductor industry can expect a swift recovery and continued innovation in advanced packaging.
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