TSMC’s Under-Construction AI Packaging Plant in Chiayi, Taiwan, Faces Multiple Setbacks Following Typhoon Danas and Prior Safety Incident
The Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest and most advanced chipmaker, is facing renewed challenges in its push to expand AI-related infrastructure. Its under-construction packaging facility in Chiayi, Taiwan, has recently endured a series of disruptions, the most recent caused by Typhoon Danas, which struck Taiwan’s western region — a rare event not seen in over a century.
TSMC’s Chiayi plant, pivotal to the company’s CoWoS (Chip-on-Wafer-on-Substrate) advanced packaging expansion for AI chips, experienced scaffolding collapse due to the typhoon’s powerful winds. According to Taiwan's Economic Daily, the Southern Taiwan Science Park Administration confirmed that while the storm’s impact was mostly contained, the collapse has introduced another construction delay for a site already affected by tragedy earlier this year.
In May 2025, a fatal workplace accident occurred at the site when a construction worker was struck by a falling switchboard. The incident halted all construction activity as Taiwan’s safety authorities launched an investigation. Only on June 3 did regulators grant TSMC permission to resume building operations. The combined setbacks have reportedly pushed the construction timeline back by at least one month.
Despite these challenges, TSMC is moving forward with urgency. The Chiayi plant is scheduled to complete its first CoWoS production line within Q3 2025, a critical milestone for the company’s ambitions to meet growing global demand for AI and high-performance computing (HPC) packaging services. The facility is expected to support chipmakers like NVIDIA, whose reliance on TSMC’s advanced manufacturing and packaging technology continues to deepen amid the AI boom.
TSMC CEO C.C. Wei addressed the situation publicly, reiterating the company’s commitment to workplace safety and corporate responsibility. “We are not in the semiconductor business just to make money,” Wei said in a previous statement. “We are aware of our social responsibility, and I will personally apologize for any safety incidents.”
As AI workloads increasingly require high-bandwidth, multi-die chiplet integration, packaging has emerged as a bottleneck in the semiconductor production pipeline. While TSMC has consistently led in silicon manufacturing, its packaging operations — particularly CoWoS and InFO technologies — are now being scaled aggressively to support the next generation of AI and data center silicon.
Though the typhoon’s damage was limited, it underscores the infrastructure vulnerability of Taiwan’s semiconductor sector to natural disasters, a growing concern given the island’s strategic role in the global tech supply chain.
Do you think Taiwan's semiconductor industry should invest more in disaster-resilient infrastructure? How should companies like TSMC balance rapid expansion with safety and environmental risks? Let us know your thoughts below.
