Chip factory for Japan

The Japanese government says it will allocate up to the equivalent of NZ$5.57 billion to finance the construction of a chip plant managed by Sony and Taiwan Semi-conductor Manufacturing Co (TSMC).

Tokyo had already advanced its interest in investing in the factory being built in Kumamoto prefecture and for it to be managed by the Japan Advanced Semi-conductor Manufacturing joint venture, in which Japanese component manufacturer Denso, a Toyota subsidiary, also participates.

The government describes the funding as “a large-scale subsidy” it hopes will bear fruit in the long term.

It will collaborate with local authorities “to ensure the factory takes root in the region and develops sustainably”.

This is the first project to secure subsidies from a public fund created to strengthen the chip industry in Japan, which also seeks to guarantee a stable national supply.

It is anticipated the factory will start production in late 2024, and it will have a monthly output of about 55,000 microchip sheets.

Sony is the world’s leading producer of image sensors used in cellphones, computers and cars, while TSMC is the biggest manufacturer of custom-integrated circuits.