Semiconductor manufacturing giant TSMC pushes development of second chip plant in Japan with new investor Toyota

Together with JASM’s first fab, the overall investment will exceed US$20 billion with “strong support from the Japanese government”, the Hsinchu, Taiwan-based company said.

TSMC is already considering a third Japanese factory using the even more advanced 3-nm tech, Bloomberg has reported.

The chip maker said the two factories in the Kumamoto site will have a total monthly production capacity of more than 100,000 12-inch wafers and create over 3,400 hi-tech jobs.

Major countries around the world – including the United States, Japan and Germany – have been racing to build a comprehensive semiconductor supply chain at home, following a chip shortage during the pandemic to avoid future disruptions to the economy.

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Japan’s Ministry of Economy, Trade and Industry is preparing some ¥2 trillion (US$13 billion) in subsidies to drive chip investments in a bid to regain its status as a major semiconductor power, with TSMC already having received some grants.

The Taiwanese chip maker’s first plant in Kumamoto is partly funded by Sony Group Corp and Denso Corp. It uses technology as advanced as 12-nm, with mass production set to start late this year.

With the latest investment, TSMC, Sony, Denso and Toyota will each hold about 86.5 per cent, 6 per cent, 5.5 per cent and 2 per cent, respectively, in JASM.

TSMC is also building two advanced facilities in Arizona, but the US project has been delayed on labour and cost challenges.

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Meanwhile, TSMC and Taiwanese government officials have repeatedly said the Japan site is progressing smoothly.

TSMC’s board on Tuesday also approved a capital injection of no more than US$5 billion in its wholly-owned subsidiary in Arizona.

The Taiwanese firm has also announced plans for a plant in Germany.