TSMC may build a third factory in Japan that will

TSMC may build a third factory in Japan that will produce 3nm chips

Late next year, a joint venture between TSMC, Sony and Denso is expected to begin operations in southwest Japan’s Kumamoto Prefecture, producing 28nm and 12nm chips to meet the needs of the latter two. TSMC is currently considering building a second Japanese factory, but rumors suggest there are plans to build a third factory where the company could produce 3nm chips.

    Image source: TSMC

Image source: TSMC

TSMC representatives were contacted by employees for clarification BloombergAll that has been confirmed so far is that the company is considering the possibility of building a second factory in Japan alongside the first. The final decision has not yet been made. From unofficial sources, it is known that TSMC’s second factory in Japan will focus on the production of 6nm and 5nm chips and could start operations in 2025.

According to rumors, TSMC is already discussing with its contractors the possibility of building a third factory in the same region of Japan that will house the first two. It is unknown when such a company will emerge, but it could produce fairly advanced 3nm chips, which in the TSMC ecosystem are currently only manufactured in Taiwan. The Japanese consortium Rapidus plans to start mass production of 2nm chips by 2027, but for a relatively young company founded just last year, such deadlines seem quite ambitious. In this regard, the TSMC project has a better chance of implementation, although the construction of a plant for the production of 3nm chips at current prices is likely to require at least $ 20 billion from investors.

So far, Japanese authorities have expressed willingness to subsidize up to half of all costs incurred by TSMC and its partners in building local businesses. However, whether the authorities will be able to provide adequate subsidies for the company’s third venture in the face of a deteriorating macroeconomic situation is being assessed. As sources explain, TSMC is theoretically able to build a fourth company in Kumamoto Prefecture, although it must be north of the three companies already planned or under consideration for construction. According to analysts at SMBC Nikko Securities, the development of the TSMC production cluster in this part of Kyushu island will increase the territory’s GDP to $496 billion by 2035, almost 10 times its current level.

After TSMC, suppliers of materials and equipment will also flock to this region, and considering that some of them have been operating in Japan for a long time, such an expansion of TSMC production will have only positive consequences for the national economy, with the exception of high need for capital investments, which could theoretically increase the country’s external debt.

About the author

Dylan Harris

Dylan Harris is fascinated by tests and reviews of computer hardware.

Add Comment

Click here to post a comment