2024-02-24 07:05:54
A new factory for Taiwanese semiconductor giant TSMC was inaugurated on Saturday in Japan, and should help strengthen the global supply of chips, which have become crucial for the economy, according to the group’s founder, Morris Chang.
This factory, TSMC’s first in the archipelago, “will, I believe, improve the resilience of chip supply for Japan and for the world”, underlined the 92-year-old veteran during the ceremony. inauguration of the factory in Kikuyo, on the southern island of Kyushu.
“It will also bring regarding a renaissance of semiconductor manufacturing in Japan,” said Mr. Chang, who rarely appears in public.
The Taiwanese giant, which counts Apple and Nvidia among its customers, controls more than half of the world’s production of chips, used in everything from smartphones and connected cars to missiles and artificial intelligence (AI).
But TSMC’s customers, as well as governments concerned regarding the supply of chips vital to their economies and defense, have pushed the company to make more chips outside the self-governing island.
TSMC has begun to further diversify its industrial capabilities, amid growing fears of an invasion of Taiwan by China, which considers the island a Chinese province that it must regain control of.
Subsidies
The Kikuyo mega-factory, costing the equivalent of $11.6 billion, was subsidized by more than 40% by Japan.
It is one of the pillars of Japan’s ambitious plan to revitalize its semiconductor industry.
The Kumamoto factory is one of TSMC’s largest overseas industrial investments, underlines Chris Miller, professor at Tufts University near Boston (northeast United States) and author in 2022 of “Chip War”, a noted book on the competition in electronic chips now taking place between Asia, the United States and Europe.
This factory “will also consolidate the political relationship between Taiwan and Japan, at a time when Taiwan seeks to ensure that it has powerful allies who can help it resist Chinese pressure,” adds Mr. Miller, interviewed by AFP.
TSMC’s new facility is also a coup for Japan, which competes with the United States and Europe to woo semiconductor companies with huge subsidies.
Prime Minister Fumio Kishida said during the opening ceremony that Japan was “now positioned as an important anchor in TSMC’s global strategy.”
The Japanese government plans to invest up to 4 trillion yen (regarding $35.8 billion) over three years, with the aim of tripling sales of “made in Japan” chips by 2030, to more than 15,000 billion yen (more than $134.5 billion at current prices) per year.
«Silicon Island»
In February, TSMC confirmed that it would build a second megafactory in the Kumamoto department, once more with significant financial support from Tokyo and private Japanese companies like Sony and Toyota.
TSMC is also considering building a third, or even a fourth, giant factory in Japan in the longer term, according to the press.
The group is also building a gigantic production site in Arizona (southwest of the United States), a project which has fallen behind schedule, and is planning another in Germany, its first in Europe.
But Japan has the advantage of being geographically close to Taiwan, having great experience in semiconductor production and being efficient: TSMC’s factory was completed in just 22 months.
The island of Kyushu has been nicknamed “Silicon Island” since the 1960s, as it concentrates more than a third of semiconductor companies in Japan.
But as with other sectors of activity, the country fears that it will lack the workforce to redevelop its semiconductor sector, due to its pronounced demographic decline.
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