TAIPEI (Taiwan News) — Taiwan’s chipmakers are expanding packaging capacity, powering a surge in Q3 manufacturing fixed-asset purchases, the Ministry of Economic Affairs said Wednesday.

The ministry said strong demand for emerging technology applications is pushing major chipmakers to expand plants and buy more equipment, per CNA. Manufacturing fixed-asset purchases reached NT$595 billion (US$19.1 billion) in Q3, up 29% from a year earlier despite a slight quarterly dip.

According to the ministry’s report, Q3 manufacturing revenue, including overseas production, stood at NT$8.82 trillion, down 0.6% from Q2 but up 2.7% year-on-year. Robust demand for AI, high-performance computing, and cloud services lifted electronics output, while global uncertainty dragged on traditional industries.

Machinery and equipment accounted for the largest share of investment at 77.1%, rising 28.9% year-on-year, while buildings and construction rose 29.8% and made up 22.4% of the total. The ministry said the parallel rise shows plant construction and equipment upgrades are accelerating.

Electronic components led all industries with NT$428.3 billion in purchases, up 42.7% and accounting for 72% of manufacturing. Chemical materials, computers and electronics, energy-related sectors, metals, and machinery showed mixed performance as high comparison bases and uneven project schedules shaped spending patterns.

The ministry said AI and high-performance computing will continue driving semiconductor investment as companies chase advanced processes. However, it said last year’s high base, combined with trade friction and geopolitical risk, may prompt more cautious capital spending.