Taiwan Semiconductor Manufacturing Co (TSMC), the world’s leading semiconductor manufacturer, is reportedly in the preliminary stages of considering an expansion of its advanced packaging technologies in Japan. This development could significantly contribute to Japan’s ambitions to revitalize its semiconductor sector. Sources close to the matter, who preferred to remain anonymous due to the private nature of the discussions, revealed that TSMC is contemplating introducing its Chip on Wafer on Substrate (CoWoS) technology to Japan. CoWoS is renowned for its ability to stack chips, enhancing processing capabilities while optimizing space and minimizing power consumption. Currently, TSMC’s entire CoWoS operations are based in Taiwan.
Although specific details regarding the scale and timeline of the potential investment remain undecided, the move underscores the growing global demand for sophisticated semiconductor packaging solutions. This demand is largely driven by advancements in artificial intelligence, prompting industry leaders like TSMC, Samsung Electronics, and Intel to expand their packaging capacities. TSMC’s CEO, C.C. Wei, announced plans earlier this year to double the company’s CoWoS output in 2023, with further expansions anticipated in 2025. Establishing advanced packaging capabilities in Japan would build upon TSMC’s existing presence in the country, where it has recently constructed one manufacturing facility and announced plans for another, both located in Kyushu, a key semiconductor production region.
The collaboration with Japanese firms, including Sony and Toyota, represents a substantial investment in TSMC’s Japanese operations, potentially exceeding $20 billion. In 2021, TSMC also inaugurated an advanced packaging research and development center in Ibaraki Prefecture, indicating a deepening commitment to Japan’s semiconductor industry. Japan, with its robust ecosystem of semiconductor materials and equipment manufacturers, along with growing chip fabrication investments and a solid customer base, is considered an ideal location for advancing packaging technologies. The Japanese government, recognizing the strategic importance of semiconductors to national economic security, has actively encouraged such investments through generous subsidies.
Analysts, however, caution that TSMC’s expansion into Japanese CoWoS packaging may be limited due to uncertain local demand and the fact that a significant portion of TSMC’s CoWoS clientele is based in the United States. This initiative is part of a broader trend, with Intel also exploring the establishment of an advanced packaging research facility in Japan. Samsung has announced plans for a similar research center in Yokohama, further highlighting Japan’s growing significance in the global semiconductor landscape.
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