TSMC Considers Building Advanced Chips In Japan After U.S. Friction – Report

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The Taiwan Semiconductor Manufacturing Company (TSMC) is considering expanding its under-construction facilities in Japan to manufacture advanced semiconductors. TSMC is building a new chip plant in Japan, which is planned to make older, mature chips. Still, according to industry insiders, differences in working culture in America and lower costs in Japan have made management consider expanding the Japanese chip site.

The Taiwanese fab has been expanding its global production base throughout the past couple of years as it adds new plants in the United States, Europe and Japan to its production portfolio. Out of these, the site in Japan is receiving additional attention now, with TSMC currently slated to spend $8.5 billion on the site to start manufacturing the products next year.

According to a fresh Reuters report, TSMC finds building a chip manufacturing site in Japan relatively easy and cheap. The firm announced in 2021 that it is establishing a new subsidiary in Japan to build a site in the Kyushu island's Kumamoto prefecture. The plant would manufacture 28-nanometer and 22-nanometer chips, and the site would see investments from Japanese consumer electronics and technology giants Sony and Denso.

Like the U.S., Japan also has a vibrant industry capable of delivering robust demand for TSMC's chips. Gauging demand for chips is a crucial part of setting up new chip manufacturing facilities since the investment costs are part of a business model developed to justify the investment.

Reuters' sources believe that TSMC is finding that the costs of building a new plant in Japan are lesser