Taiwan Semiconductor Manufacturing (TSMC) has recently expressed interest in potentially constructing a third plant in Japan to produce advanced 3-nanometer chips, according to sources familiar with the matter. The chipmaking giant, known for its high-profile clients like Nvidia and Apple, has reportedly communicated its plans to its supply chain partners.
While TSMC is currently in the process of building one fab in Japan for less advanced chips, the company’s consideration of a third facility, codenamed TSMC Fab-23 Phase 3, in the southern Japanese prefecture of Kumamoto, suggests an ambitious expansion strategy. The exact timeline for the construction of the third plant remains uncertain.
It is worth noting that TSMC’s mainstay of 3nm chip production, touted as the cutting-edge technology currently available, may face advancements by the time the potential third fab becomes operational. However, this expansion plan could bring significant benefits to Japan, which has been actively offering subsidies to attract investments from both domestic and foreign semiconductor companies. Notably, Japan has already secured investments from industry giants like Micron Technology, Samsung Electronics, and Powerchip Semiconductor Manufacturing.
While the cost of establishing a 3nm fab is estimated to be around $20 billion, including production machinery, the actual expenses would depend on factors such as the timing of facility construction and land acquisition. Typically, Japan covers about half of these costs for similar factories.
With TSMC’s ongoing construction of a facility in Kumamoto, backed by investments from Sony Group and Denso, the production of chips like 12nm is expected to commence in late 2024. Additionally, the company plans to build a second facility in close proximity to its first plant, which will be capable of manufacturing 5nm chips starting in 2025.
Q: What is TSMC considering in Japan?
A: TSMC is considering building a third plant in Japan to produce advanced 3-nanometer chips.
Q: Who are some of TSMC’s clients?
A: TSMC counts Nvidia and Apple among its clients.
Q: What are the potential benefits of TSMC’s expansion in Japan?
A: If realized, the expansion could bring significant investment and subsidies to Japan’s semiconductor industry.
Q: What is the current state of TSMC’s construction projects in Japan?
A: TSMC is currently constructing a facility in Kumamoto and plans to build a second facility nearby, with chip production expected to commence in late 2024 and 2025, respectively.