TSMC, the Taiwanese semiconductor giant, has reportedly rejected a request from NVIDIA CEO Jensen Huang for a dedicated packaging manufacturing line for NVIDIA’s products. This news underscores the growing importance of chip packaging, especially for the production of AI GPUs. The demand for advanced packaging has skyrocketed, with companies struggling to keep pace. TSMC, in particular, has been investing heavily in expanding its advanced packaging capacity to meet the increasing demand.
Earlier this year, Jensen Huang visited TSMC headquarters, meeting with the company’s founder, Dr. Morris Chang, and former chairman. During the meeting, Huang requested TSMC establish a dedicated packaging line specifically for NVIDIA GPUs. Sources within the industry report that the discussion between Huang and TSMC executives was “quite tense.” TSMC executives reportedly questioned Huang’s request extensively. The discussions ultimately proved unproductive, with the atmosphere described as “tense.”
The shortage of advanced packaging capacity has become a significant issue in the AI market since its surge in popularity in 2023. TSMC, despite its efforts, has been unable to handle the demand for its advanced packaging. Reports indicate that its advanced packaging capacity is fully booked through 2025. Both NVIDIA and AMD have reserved TSMC’s CoWoS and SoIC advanced packaging for 2024 and 2025, forcing TSMC to scramble to increase its capacity.
