Dreamstime Images
Dreamstime L 148881836 6176dfeb6d798

New Japanese Semiconductor Plant May be in the Works

Oct. 27, 2021
As the global chip shortage drags on, Sony and TSCM join forces to start planning out a new, $7 billion fab manufacturing plant in Japan.

Download this article in PDF format.

After spending much of 2021 trying to source the semiconductors that they need to be able to make their final product, the world’s manufacturers may be starting to see a glimmer of hope and potential light at the end of the proverbial chip shortage tunnel. And while the relief won’t come overnight, the fact that Sony and Taiwan Semiconductor Manufacturing Co. (TSMC) are in the planning stages of a new semiconductor plant in Japan may be a positive sign.

The plant can’t come to fruition soon enough. According to The New York Times, companies like Toyota continue to cut production in an effort to offset the global semiconductor shortage. The automaker recently cut upcoming production targets by up to 15% and others are struggling to keep up with “rebounding demand for their vehicles as pandemic restrictions in the world’s largest auto markets ease and consumers look to make up for lost time,” the publication reports.

In the Planning Stages

According to Nikkei Asia, the two companies are currently planning out a $7 billion plant that will be funded in part by the Japanese government. Japanese auto parts maker Denso may also participate in the project by setting up equipment at the site and Sony may take a minority stake in a new company that will manage the factory, which will be located in Kumamoto Prefecture, the publication reports.

“The factory will make semiconductors used in camera image sensors, as well as chips for automobiles and other products, and is slated to go into operation by 2024,” Nikkei Asia reports. This would be TSMC's first chip production operation in Japan, where the government is “increasingly concerned” about maintaining supply chain stability amid the chip shortage and escalating geopolitical issues.

“Japanese chipmakers had dropped out of the race for large-scale chip development by the 2010s and instead contracted out the production of cutting-edge semiconductors to companies like TSMC,” Nikkei Asia reports. “By accepting direct investment from the Taiwanese company, Japan hopes to revive the production of advanced products in the country.”

FORTE – The intelligent BOM tool

Master your Bill of Materials with greater intelligence.
Your search returned no results. Please try expanding your search.

According to South China Morning Post, the new fab plant may begin construction next year and be at the mass production stage at some point in 2024. The fab project will use mature 22- and 28-nm technologies and is being “widely watched” in a world where multiple countries would like to boost local chip production capabilities, SCMP reports, noting that the project is currently awaiting approval by TSMC’s board.

The publication hints that TSMC may also build fabs in other regions, including Europe. “The world’s largest contract chip maker is being pursued by national governments keen to protect semiconductor supply chains by bringing chip manufacturing onshore,” it adds, noting that the current global chip shortage is slated to last through 2022.

Mature and Specialty Fab Tech

AnandTech says the semiconductor manufacturing facility will focus on mature and specialty fabrication technologies used to make chips with long lifecycles for automakers and consumer electronics. “The fab will be Japan's most advanced fab for logic when it becomes operational in late 2024,” it adds. “And if the rumors about planned investments are correct, it could also be Japan's largest fab for logic chips.”

When it comes online in 2024, the plant will process 300-mm wafers using a variety of specialty and mature nodes, including a number of 28 nm technologies as well as 22ULP process for ultra-low-power devices, AnandTech reports. “These nodes are not used to make leading-edge ASICs and SoCs,” it adds, “but they are widely used by automotive and consumer electronics industries and will continue to be used for years to come not only for existing chips, but for upcoming solutions as well.”

About the Author

Bridget McCrea | Contributing Writer | Supply Chain Connect

Bridget McCrea is a freelance writer who covers business and technology for various publications.

Voice your opinion!

To join the conversation, and become an exclusive member of Supply Chain Connect, create an account today!