TSMC announces plans to create a second chip plant in Japan
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Taiwan Semiconductor Manufacturing Co (TSMC) plans to build a second chip factory in Japan. This newly constructed chip plant will manufacture five and ten nanometer chips in the second half of the current decade.
TSMC to build a second chip in Japan
The expansion plans being made by TSMC in Japan could boost the chip manufacturing activities in Japan. The move could allow Japan to revive advanced semiconductor manufacturing. The country views this sector as one of the determinants of the country’s future economic growth that new digital technologies would support.
The second plant that TSMC in Japan is creating will cost over 1 trillion yen, equivalent to around $7.4 billion to build, according to a report by Nikkan Kogyo. TSMC has addressed this report referring to the earlier comments made by the company’s CEO, C.C. Wei, during the last quarterly earnings call in January.
During this earnings call, the company said it plans to build a second plant in Japan but would not share more details. TSMC is the largest maker of advanced logic chops globally. It is now working on creating the first foundry in Japan situated on Kyushu island, with the production of 12 and 16 nanometer semiconductors expected to start next year.
The government of Japan has offered to give TSMC a subsidy of 476 billion yen, which is equivalent to around half of the expected cost of the factory. The company has also secured investors, including Denso Corp and Sony Group, which will be using the manufactured chips created by the chip maker.
US to strengthen the domestic semiconductor manufacturing
As TSMC looks to expand its operations in Japan, the US plans to strengthen domestic semiconductor manufacturing. The US will use the funds received from the $52 billion CHIPS and Science Act to create two large-scale logic clusters that will be used to manufacture conductors.
TSMC will also work with several high-volume advanced packaging facilities that will be released in 2030, according to the Commerce Secretary, Gina Raimondo. The announcement made by this official comes as the department readies itself to start applications in the coming week for businesses that want to get funding under the CHIPS Act that was signed into law in August.
“Each cluster will include a robust supplier ecosystem, R&D facilities to continuously innovate new process technologies, and specialized infrastructure,” Raimondo said. “Each of those clusters will employ thousands of workers in well-paying jobs.”
The CHIPS Act was created to boost the competitiveness of the US in the semiconductor industry against manufacturing giants such as Taiwan. The country produces 92% of the most popular chips globally.
The overreliance of the global supply chain on a single country like Taiwan is attributed to the shortages witnessed during the pandemic. The shortage triggered national security concerns as a disruption in chip production could hinder the production of multiple goods.
