The Taiwan Semiconductor Manufacturing Company (TSMC) has begun work on a €10 billion plant in Dresden.
It comes as the European Commission approved €5 billion in state subsidies for the world’s largest chipmaker.
TSMC is establishing its first European location with the Dresden plant, which will specialise in chips for the automotive and industrial sectors.
The company announced the selection of Dresden as its site in August 2023.
Production is expected to begin in 2027, with a target capacity of 40,000 chips per month by the end of 2029.
Robert Hermann, CEO of Germany Trade & Invest, said: "Together with other significant projects planned by giants like Infineon and Intel, this confirms that the eastern part of Germany is Europe's semiconductor heartland."
