What’s new: Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) and Sony Semiconductor Solutions Corp. (SSS) confirmed reports that they will build a $7 billion chip factory in the southwestern Japanese city of Kumamoto.
Construction of the plant, which will be operated by a joint venture between TSMC and SSS, will start in 2022, with production scheduled to begin by the end of 2024, the companies said in a joint statement Tuesday.
The facility will initially make chips using older 22-nanometer and 28-nanometer technologies, with a production capacity of 45,000 12-inch wafers per month, the statement said.
SSS will invest about $500 million in the joint venture, named Japan Advanced Semiconductor Manufacturing Inc., in exchange for as much as a 20% stake, according to the statement.
The background: Tuesday’s announcement comes as a global semiconductor crunch continues to cripple the supply chains of everything from cars to consumer electronics.
Thanks to its status as the world’s No. 1 contract chipmaker by market share, TSMC has long been highly favored by the governments of the U.S. and Japan, which want the Taiwanese firm to build plants in their territories to help address chip shortages.
In June, TSMC reportedly began construction at a site in the U.S. state of Arizona, where it plans to build a factory that is set to start mass production of computer chips using advanced 5-nanometer technology in 2024.
TSMC, which is developing cutting-edge 3-nanometer technology, retained its crown as the world’s largest contract chipmaker in the second quarter of 2021 with a market share of 52.9%, according to research firm TrendForce.
Read more Chipmaker TSMC Assures Customer Confidentiality in Data Submission to Washington
Contact reporter Ding Yi (yiding@caixin.com) and editor Flynn Murphy (flynnmurphy@caixin.com)
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