- TSMC is already constructing its first foundry in a joint venture with Sony, in Japan
- Japanese chip-making equipment manufacturers in Japan continue to invest heavily in the sector despite global chipmakers cutting down on capex.
Taiwan Semiconductor Manufacturing Co Ltd (TSMC) has reportedly started the construction of a second chip factory in southwestern Japan with an estimated investment of $7.4 billion (1 trillion yen).
Japan’s Nikkan Kogyo newspaper reported the news first.
At its last quarterly earnings call in January, TSMC CEO, CC Wei announced that the company was considering building a second plant in Japan. The company did not elaborate on the statement.
Wei had then said that another Japan operation would be under consideration as long as “demand from customers and the level of government support makes sense.” He had reiterated the comments at other news conferences as well.
TSMC is already constructing its first foundry in Japan in Kumamoto Prefecture, on Kyushu island. The foundry will begin the production of 12 and 16-nanometre semiconductors next year.
TSMC’s project is a joint venture with Sony worth $8.6 billion (1.1 trillion yen).
While chip manufacturers around the world are scaling back on capital expenditure amid a global economic slowdown, chip-making equipment manufacturers in Japan have remained largely bullish and continue to build factories and bolster investment in the sector.
Last year Kyocera, a Kyoto-headquartered electronics manufacturer, announced that they will expand investment in semiconductor-related production, while V Technology, which designs machinery for the chip industry, opened a new factory and research centre in Yokosuka, Kanagawa Prefecture.
The Japanese central government is actively encouraging its domestic semiconductor companies to expand overseas. In November 2021, officials announced an aim to increase their annual semiconductor revenue to more than $114 billion (13 trillion yen) by 2030.