Trumpf increases investment to expand its Taiwan factory

The German laser and plasma technology company Trumpf SE + Co KG is further expanding its investment in the Taiwan region to deepen its involvement in the global semiconductor supply chain and drive sustained business growth. As a leading global supplier of lasers and plasma generators for chip manufacturing, headquartered in Ditzingen, Germany, the company recently established a new regional plasma generator technology center in Taoyuan, Taiwan. This investment marks another expansion of its localized technological and service capabilities, following more than 25 years of operation in Taiwan across multiple industry sectors.

The center, the first of its kind Trumpf built outside Germany, aims to serve customers from Taiwan, Japan, Southeast Asia and South Korea, the company said.

It is equipped with infrastructure dedicated to the analysis, service and calibration of Trumpf’s plasma generators, it said. Prior to the launch of the center, the service and renewal of plasma generators mostly took place in Trumpf’s Germany headquarters.

“This was a starting point for our further development in this [semiconductor] industry... Our intention is also to extend this in upcoming years, not only one year,” Trumpf Taiwan Industries Co managing director Patrick Kemnitz said in an exclusive interview with the Taipei Times on Monday last week.

“So, we will follow our local-for-local strategy again. Based on this, we can say further extension of our services which we can provide locally to our customers,” Kemnitz said, adding that Trumpf has been diversifying and localizing its supply chains to enhance resilience since the COVID-19 pandemic, and that the approach helped it counteract geopolitical risks.

As the company is ramping up its plasma generator business in Taiwan, the number of local employees is expected to rise to about 170 by the end of this year, compared with 160 currently, Kemnitz said.

Trumpf operates five sites in Taiwan, and develops its businesses in alignment with industrial megatrends and customer demand, he added.

On top of the machine tools and industrial lasers, semiconductors have become a new growth pillar for Trumpf over the past 10 years.

The company generated about 1 billion euros (US$1.16 billion) from the semiconductor sector, which made up about 23 percent of the company’s total revenue of 4.3 billion euros during the fiscal year between July 1, 2024, and June 30 last year, its annual report showed.

Trumpf has been developing different applications in the semiconductor supply chain from plasma generators, which is a core component for semiconductor production equipment, Kemnitz said.

The company, established more than 100 years ago, also supplies carbon dioxide lasers for extreme ultraviolet (EUV) lithography systems for ASML Holding NV, he said.

Trumpf is the sole laser source supplier to ASML. It uses Trumpf’s carbon dioxide laser to hit tin droplets to generate a plasma, which then generates EUV that is captured and brought to the scanner.

To expand its local ecosystem, Trumpf in 2023 set up an EUV training center in Tainan, one year after Taiwan Semiconductor Manufacturing Co started volume production of 3-nanometer chips at its Fab 18 in Tainan using ASML’s EUV tools.

TSMC’s 2-nanometer chips entered volume production at its Fab 22 in the fourth quarter of last year.

The chipmaker’s 3-nanometer and 2-nanometer technology are used by Nvidia Corp and Advanced Micro Devices Inc for their artificial intelligence (AI) chips.

Trumpf also supplies laser cutting machines, bending machines, punching machines and laser welding machines, Kemnitz said.

These machines are used to manufacture equipment for fabs, from major chipmakers and original equipment manufacturing service providers — such as TSMC — to data centers, Kemnitz added.

As most of the infrastructure is made of sheet metal, the semiconductor became a very important industry for Trumpf’s overall businesses, he said.

While analysts and investors are debating whether the AI industry is overheating and heading for a crash, Kemnitz said he believed AI would continue to be a growing field this year, given its fast paced technology development.

“I would say this [AI] trend will continue because if you can see the speed and the pace AI is developing, I think there are still many steps possible,” Kemnitz said.

AI applications would continue driving the overall semiconductor industry this year and Trumpf’s semiconductor business would grow along with the industry, he added.

The global semiconductor market is expected to expand at least 11 percent annually to US$890 billion this year, as significant AI infrastructure investments continue to drive demand for AI accelerators, power management chips and other chips for AI devices, International Data Corp forecast.

World Semiconductor Trade Statistics was more optimistic, projecting the industry to grow more than 25 percent this year to reach US$975 billion, with growth across all regions and product categories.

Source: taipeitimes