Chip contracting giant Taiwan Semiconductor Manufacturing Co (TSMC) confirms plans to build a new factory in Japan.

And the earlier reports have been confirmed which suggested that TSMC was considering building a chip factory in conjunction with Sony Corp, alongside an investment from the Japanese government.

TSMC had also said in the summer it was considering building a Japanese factory.

Japan factory

Construction of the new plant is expected in 2022, but actual production is only slated to begin in 2024.

This fast build time for the factory is because the facility will be setup to use older chip making technology,  in order to product the older chips that are in such demand from car makers and consumer device makers.

This will mean the new factory will focus on larger 22nm and 28nm chips used for image sensors and microcontrollers.

Setup costs for the new factory are reportedly $7 billion, and are expected to be split between TSMC, Sony, and the Japanese government.

The Japanese government expected to provide up to half the funding needed, and shows the desire of national governments to establish chip factories in their own countries.

The plant is expected to be jointly run with Sony, and the factory will reportedly be located in Kumamoto Prefecture, on land owned by Sony and in an area adjacent to the latter’s image sensor factory.

Economic security

TSMC CEO C.C. Wei told an online investors’ conference that after conducting due diligence, the company decided to build a speciality technology fabrication plant, subject to the approval of its board of directors.

“We have received a strong commitment to support this project from both our customers and the Japanese government,” Wei reportedly said.

Japanese Prime Minister Fumio Kishida welcomed the news, saying the chip factory will serve to improve Japan’s economic security.

It is understood that financial aid for such projects will be included in an upcoming stimulus package, he said at a press conference in Tokyo.

Tom Jowitt

Tom Jowitt is a leading British tech freelancer and long standing contributor to Silicon UK. He is also a bit of a Lord of the Rings nut...

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