TSMC Begins Small-Scale 2nm Wafer Production at Baoshan Facility

TSMC, the leading semiconductor manufacturer, is rapidly expanding its 2nm wafer production capabilities with two advanced manufacturing sites in Taiwan. These facilities are expected to reach maximum capacity in the coming years to meet the growing demand from major clients, including Apple, Qualcomm, and MediaTek.

Reports indicate that TSMC has commenced small-scale production of 2nm wafers at its Baoshan facility, achieving a monthly output of 5,000 wafers. This follows a successful trial production phase where a yield rate of 60% was recorded for the 2nm technology. As part of its innovation strategy, the company has introduced an upgraded N2P variant, enhancing its first-generation 2nm process. Mass production of this advanced N2P node is scheduled for 2026, while the first-generation 2nm process is expected to begin full-scale manufacturing in 2025.

TSMC's Baoshan and Kaohsiung plants are pivotal in scaling up production. According to reports, the company has already implemented cutting-edge lithography techniques for small-scale production, limited to 5,000 wafers per month. During trial phases, production volumes reportedly reached 10,000 wafers, with projections indicating a ramp-up to 50,000 wafers later this year and potentially 80,000 wafers by 2026. However, it remains unclear whether this production will combine both N2 and N2P processes or focus on one variant.

Once both facilities reach full operation, TSMC's combined monthly output is expected to exceed 40,000 wafers. This expansion underscores the company's leadership in advanced semiconductor manufacturing, with no other foundry matching its technological capabilities. Consequently, companies aiming to launch cutting-edge chips continue to rely on TSMC for their production needs.

The rising cost of 2nm wafers, estimated at $30,000 each, has raised concerns among clients. While the complexity of the 2nm process inevitably increases costs, TSMC is actively exploring strategies to mitigate expenses. One notable initiative is the "CyberShuttle" service, launched in April 2024. This program allows multiple clients, including Apple and Qualcomm, to test their chip designs on a shared wafer, significantly reducing development costs.

Economies of scale will be crucial in balancing costs as TSMC increases its production volume. Achieving full-capacity operations at the Baoshan and Kaohsiung plants will be instrumental in making 2nm wafer production more cost-effective for the company's clients.