Apple Inc’s ( AAPL) chip supplier Taiwan Semiconductor Manufacturing Co Ltd (TSM) is planning to build an advanced semiconductor manufacturing facility in South Taiwan, Nikkei Asia reported on Monday, citing people familiar with the matter.

Benzinga (TSMC)

What Happened: 

The new facility is being planned in the city of Kaohsiung and is a part of a $100 billion expansion to meet the ongoing global chip shortages that have hit auto and smartphone makers.

It will be a first for the Taiwan-based supplier to expand its presence in the industrial harbor of Kaohsiung, which is popular as the world's biggest chip packaging and testing service destination.

Construction of the new facility will start as soon as next year but the plant will not start operating until 2024, Nikkei Asia noted.

Why It Matters: 

The world’s largest chip contractor plans to invest heavily until 2023 to ensure enough production capacity at home and overseas. The chipmaker also recently secured final regulatory approval to build its most advanced chip plant yet in the Taiwanese city of Hsinchu. It is also known to be finalizing discussions for its first chip-making plant in Japan and Germany.

Price Action: 

TSMC shares closed 0.24% higher at $122.97 on Friday.