Taiwan Semiconductor Manufacturing Co, the largest contract chip manufacturer in the world, is considering building a second plant in Japan, a senior Japanese politician said on Friday.
The Taiwanese company is already building a $8.6 billion chip facility in the country, with Sony Group and auto parts maker Denso Corp each taking a minority stake. Production at the plant is due to start in late 2024.
Yoshihiro Seki, secretary general of a ruling party legislators’ group on chip industry policy, also encouraged Japan’s government to create an atmosphere that is conducive to investment. Japan has promised to provide up to 476 billion yen ($3.6 billion) in subsidies for the first TSMC factory.
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“I believe TSMC is looking into further investments in Japan. We need to create an environment that would make them think they want to do advanced projects with us,” Seki told Reuters in an interview.
TSMC said in a statement it did not rule out any possibility for Japan but there were no concrete plans at the moment.
The chipmaker, Asia’s most valuable listed company, has been diversifying its production base amid rising military pressure from China on Taiwan.
The island’s dominant position as a maker of chips used in technology from cellphones and cars to fighter jets has caused concern the world is too reliant on its supply chain.
TSMC has recently tripled its planned investment in a US chipmaking plant in Arizona to $40 billion. It is also reportedly in advanced talks with suppliers about possibly setting up its first European plant in Germany.
Boosting Japan’s chip industry
Seki’s group within Japan’s Liberal Democratic Party is advocating for Japan to strengthen its semiconductor industry.
Its share has fallen to less than 10% of the global market by revenue from more than half in the late 1980s.
Technological innovation is fierce in the semiconductor industry,” Seki said.
“We cannot be successful unless the public and private sectors act as one unified body.”
In a policy speech in October, Prime Minister Fumio Kishida positioned semiconductors as pivotal to Japan’s economic security. He also pledged to funnel public and private investments into the industry.
- Reuters, with additional editing by Vishakha Saxena