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TSMC Launches First of Three Japanese Fabs

February 26, 2024

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On Saturday, Taiwan Semiconductor Manufacturing Company (TSMC) made a significant move by opening its first Japanese fab in Kumamoto, located on the island of Kyushu. The inauguration ceremony was attended by Japanese Prime Minister Fumio Kishida, who participated via video link. During the event, the Japanese government announced its decision to provide TSMC with $4.85 billion in subsidies to support the construction of a second fab in Kumamoto. This additional funding brings the total subsidies for the two fabs to an impressive $8 billion.

Kishida emphasized the strategic importance of the new fab, stating that Japan is now being positioned as a crucial foothold in TSMC's global strategy. The fabs in Kumamoto are operated by a joint venture known as Japan Advanced Semiconductor Manufacturing (JASM), in which TSMC, Sony, Denso, and Toyota hold equity stakes of approximately 86.5%, 6.0%, 5.5%, and 2.0%, respectively.

The first fab in Kumamoto, referred to as Kumamoto 1, had an initial cost of $8.6 billion and received a $3.2 billion subsidy from the government. This facility is designed to have a total capacity of 40,000 to 50,000 wafers per month (wpm), focusing primarily on 22/28nm processes with some 12/16nm capabilities expected to begin in the fourth quarter. On the other hand, Kumamoto 2 is scheduled to commence operations with a 6nm process in 2027. Together, the combined capacity of both fabs will reach 100,000 wpm.

During the opening ceremony, Morris Chang, the founding CEO of TSMC, expressed his optimism about the new fab's impact on the semiconductor industry. Chang stated, "I believe this fab will improve the resiliency of chip supply for Japan and the world. It will also mark the beginning of a renaissance in semiconductor manufacturing in Japan." Looking ahead, TSMC has plans to establish a third fab in Japan, with a focus on 6/7nm processes that will eventually lead to 5nm or 3nm technologies.

In addition to the fabs, TSMC is also setting up a 3DIC research center in Ibaraki and is preparing to launch an advanced packaging plant in Japan. These initiatives will further solidify TSMC's presence in chip manufacturing within the country. Japan is actively developing three semiconductor manufacturing hubs in Kyushu, Tohoku, and Hokkaido, with a particular focus on advancing technologies such as the 2nm process through companies like Rapidus.

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