While TSMC is pushing forward with its 2nm fab in Taiwan, there is also good news about its overseas expansion. According to the Japanese newspaper “Kumanichi,” TSMC is expected to announce the construction of its Kumamoto Fab 2 in Japan on February 6, with the possibility of incorporating the 7nm process. Additionally, the United States is also expected to provide several billion dollars in subsidies to TSMC’s new fab by the end of March.

▲ TSMC’s Layout of Global Production Capacity Edited by TrendForce, January, 2024

Per the report from the ” Kumanichi,” Japan’s Minister of Agriculture, Forestry, and Fisheries, Tetsushi Sakamoto, who hails from Kumamoto, stated during a local meeting on January 28th that TSMC is evaluating Kumamoto Prefecture’s Kikuyo Town as the location for its second fab. The announcement of the site for Fab 2 in Kumamoto is expected to be made as early as February 6th.

The report further indicates that Fab 2 is expected to be situated next to the first fab, which was completed at the end of last year. TSMC had previously mentioned that if a second fab were to be constructed, it would be located in the vicinity of the existing facility under construction.

Regarding the rumors, the spokesperson for TSMC stated that the expansion strategy of TSMC’s global manufacturing footprint is based on considerations of customer demand, business opportunities, operational efficiency, government support, and economic costs.

Through necessary investments, TSMC continues to support customer demands and respond to the structural growth of semiconductor technology in the long term. “We are currently focusing on evaluating the possibility of setting up a second fab in Japan, and there is no further information to share at the moment.”

During the recent earnings call, Mark Liu also mentioned that the plan for TSMC’s second fab in Japan is still under evaluation. However, he hinted at the possibility of adopting the 7-nanometer process.

TSMC’s Kumamoto plant is scheduled to hold its opening ceremony on February 24th. After retiring following the shareholders’ meeting in June this year, TSMC Chairman Mark Liu, along with the designated successor and current President C.C.Wei, will lead several top executives to Japan for the event. TSMC has also invited Japanese Prime Minister Fumio Kishida to attend.

The decision for TSMC to establish a plant in Kumamoto, Japan, was announced in October 2021, and construction began in 2022. In comparison to TSMC’s announcement of a plant in the United States in 2020, which faced delays and is set to commence production in 2025, the Japanese plant has advanced more swiftly.

This aligns with TSMC founder Morris Chang’s statement last year that Japan is considered an ideal location for establishing a semiconductor supply chain.

Analyst Joanne Chiao from TrendForce previously pointed out that Japan’s expertise in materials and machinery is one of the factors attracting TSMC’s expansion. Japan stands to benefit from TSMC’s establishment as the pace of creating a local semiconductor ecosystem by Japanese government surpasses that of the U.S. government.

On the other hand, despite TSMC delaying the production at its new US plant, according to Bloomberg, the United States plans to announce substantial chip subsidies by the end of March. The aim is to pave the way for chip manufacturers like TSMC and Intel by providing them with billions of dollars to accelerate the expansion of domestic chip production.

These subsidies are a core component of the US 2022 “CHIPS and Science Act,” which allocates a budget of USD 39 billion to directly subsidize and revitalize American manufacturing.

Read more

• [News] Completion of TSMC’s Kumamoto Plant, Grand Opening on 2/24
• [News] Rumored to Build Third Plant in Kumamoto, TSMC: Currently Focusing on Assessing the Construction of a Second Plant

(Photo credit: TSMC)

According to Taiwan’s Economic Daily, after disassembling Huawei’s Mate 60 Pro smartphone, it has been revealed that the chips, including the Kirin 9000S, are produced by China’s semiconductor foundry, SMIC, using their advanced 7-nanometer process. This development has brought attention to SMIC’s manufacturing capabilities. Recently, it has been reported that SMIC has placed a substantial order with Taiwanese suppliers in the supply chain, equivalent to approximately two years’ worth of demand, and is urging swift delivery.

While SMIC has established itself in mature semiconductor manufacturing processes and serves not only domestic IC design companies but also many Taiwanese IC design firms, it has been actively trying to catch up with foreign giants in advanced manufacturing processes. Additionally, limitations in acquiring equipment like EUV have constrained its progress, making its achievements in the 7-nanometer process a noteworthy accomplishment.

In light of these developments, it has been reported that SMIC has approached Taiwanese partner companies to secure a substantial supply of specific products for an estimated two-year period, likely to be used in their advanced 7-nanometer manufacturing process. SMIC is hoping for proactive cooperation from its supply chain partners to ensure prompt delivery.

(Photo credit: SMIC)