TSMC is considering expanding production capacity in Japan in what would be a move by the world's largest chip foundry to reduce geopolitical risks, people familiar with the matter said.
The Wall Street Journal quoted people familiar with the matter as saying that the Japanese government has indicated that it wants TSMC to further expand production capacity in Japan on the basis of the capacity already under construction, but the relevant decision has not yet been made, and TSMC is studying the feasibility of doing so.
TSMC is currently building the company's first chip plant in Japan on the southern Japanese island of Kyushu. The multibillion-dollar factory is subsidized by the Japanese government. TSMC is a Taiwanese company that makes chips for a number of major electronics makers, including Apple Inc.
The semiconductor industry has been in turmoil since a widespread chip shortage last year left auto manufacturing and other industries in turmoil, at the same time as concerns among allies such as the United States and Japan have grown over the rise of China's semiconductor industry and the concentration of chip manufacturing in Taiwan.
One response to these concerns is TSMC's ongoing construction of a plant in Japan, which will increase production capacity in Japan. The factory is likely to focus on producing mature-process chips typically used in parts such as cars and sensors, with shipments scheduled to begin in late 2024. Japan Advanced Semiconductor Manufacturing, a company controlled by TSMC, is building the plant.
If TSMC expands further from its current plans, it may consider making advanced-process chips in Kyushu, the people said. A TSMC spokesman said construction of the Japanese project was on track, and declined to comment on whether it would expand further.
