18 March 2024 – Taiwan’s semiconductor powerhouse, TSMC, is reportedly exploring the possibility of establishing advanced chip packaging capacity in Japan, a move poised to invigorate Japan’s semiconductor industry.
Sources familiar with the matter revealed that discussions are in early stages, with TSMC considering introducing its chip-on-wafer-on-substrate (CoWoS) packaging technology to Japan. CoWoS is a sophisticated process known for stacking chips atop each other, enhancing processing capabilities, saving space, and reducing power consumption.
Currently, all of TSMC’s CoWoS capacity is based in Taiwan, with no final decisions made regarding the scale or timeline of this potential investment.
The global demand for advanced semiconductor packaging has surged, driven by the proliferation of artificial intelligence applications. Major chipmakers like TSMC are ramping up packaging capacity to meet this escalating demand.
TSMC’s Chief Executive, C.C. Wei, has previously outlined plans to double CoWoS output in 2024, with further expansions slated for 2025.
The prospective establishment of advanced packaging capacity in Japan would complement TSMC’s existing operations in the country, including recent plant constructions and collaboration ventures with leading Japanese companies like Sony and Toyota, with total investments exceeding $20 billion.
This strategic move aligns with Japan’s ambition to strengthen its semiconductor industry, leveraging its strong ecosystem and supportive environment for such initiatives.
While analysts caution about the uncertainty of demand for CoWoS packaging within Japan, TSMC’s ventures have been supported by substantial subsidies from the Japanese government, which views semiconductor development as crucial for its economic security.
TSMC’s exploration of advanced packaging expansion in Japan reflects the broader trend of global chip firms being attracted to Japan’s proactive stance in revitalizing its semiconductor sector. This proactive approach has also lured other industry players like Intel and Samsung Electronics, further cementing Japan’s position in the global semiconductor landscape.
