TSMC is building a Production Line Platform (PLP) to significantly improve the efficiency of AI chip manufacturing.

June 15 (ET News) — Taiwan Semiconductor Manufacturing Co. (TSMC) is set to adopt next-generation semiconductor packaging technology called Panel Level Packaging (PLP), marking a direct challenge to Samsung Electronics as it prepares to ramp up production for the fast-growing AI chip market. Industry sources familiar with the matter told ET News on the 15th that TSMC is building out its Materials, Components, and Equipment (MCE) supply chain to launch a PLP production system, currently in talks with domestic and international MCE firms on equipment investment. The firm plans to kick off PLP mass production as early as next year—a major milestone in its PLP push. Unlike traditional Wafer Level Packaging (WLP), which uses circular wafers that waste large swathes of usable edge space and drag down productivity, PLP packages chips on rectangular panels. A standard 600x600mm PLP panel produces 5 to 6 times more chips than a mainstream 300mm (12-inch) WLP wafer, eliminating waste and boosting efficiency significantly— a key advantage for scaling AI chip output and supporting larger-area AI designs. Currently, Samsung holds a competitive edge in PLP: it acquired the PLP business from Samsung Electro-Mechanics in 2019 and has refined the technology for mobile application processors (APs) and power management ICs (PMICs). TSMC, by contrast, was relatively passive in PLP historically, leaning on its traditional WLP dominance in foundry services. But explosive AI chip growth has reversed that dynamic: PLP’s AI-friendly traits prompted TSMC to actively prioritize PLP since 2024. It’s on track to complete and launch a pilot line this year, with mass production targeted for next year after performance reviews, and is reported to have secured a global AI chip customer. As TSMC accelerates PLP mass production, competition with Samsung will intensify. Samsung also plans to expand PLP beyond APs and PMICs to High-Performance Computing (HPC) chips, including AI semiconductors. Additionally, both firms will vie for leadership in the next-gen substrate market, with glass substrates emerging as a top choice for AI chips and a critical component of PLP processes. “Not only Samsung and TSMC, but global Outsourced Semiconductor Assembly and Test (OSAT) companies are also making significant inroads into the PLP process market,” an industry insider said. “Intense competition is on the way, and the market is poised for strong growth.”