TSMC Eyes Japan for Advanced Chip Packaging Expansion, Boosting Semiconductor Sector

According to undisclosed reports, Taiwan's TSMC is exploring plans to extend advanced packaging capacity to Japan, potentially elevating the country's semiconductor industry rejuvenation.

TSMC Considers Expanding Advanced Packaging to Japan, Potentially Boosting Semiconductor Industry

Taiwan's TSMC is reportedly considering building advanced packaging capacity in Japan, boosting Japan's efforts to revitalize its semiconductor industry, Reuters stated.

They added that the discussions are still in their early stages and declined to be identified because the information was not public. According to one source briefed on the matter, the chipmaking giant is considering bringing its chip-on-wafer-on-substrate (CoWoS) packaging technology to Japan.

CoWoS is a high-precision technology that stacks chips on each other to increase processing power while saving space and lowering power consumption. TSMC currently has all of its CoWoS capacity in Taiwan.

The source stated that no decisions have been made regarding the size or timeline of a potential investment. TSMC, formerly known as Taiwan Semiconductor Manufacturing Co., declined to comment.

Demand for advanced semiconductor packaging has risen globally in tandem with the artificial intelligence boom, prompting chipmakers such as TSMC, Samsung Electronics, and Intel to expand capacity.

TSMC's Ambitious Expansion Plans Signal Japan's Rising Importance in Semiconductor Industry

In January, TSMC Chief Executive C.C. Wei stated that the company intends to double CoWos output this year and schedule further increases for 2025.

Building capacity for advanced packaging would allow TSMC to expand its operations in Japan, where it recently built one plant and announced another on the southern island of Kyushu, a chipmaking hub.

TSMC is partnering with companies such as Sony and Toyota, with a total investment in the Japan venture expected to exceed $20 billion.

In 2021, the chipmaker will open an advanced packaging research and development center in Ibaraki prefecture, northeast of Tokyo.

Japan is viewed as well-positioned to play a larger role in advanced packaging due to its leading semiconductor materials and equipment manufacturers, increasing investment in chip fabrication capacity, and strong customer base.

Photo: Briáxis F. Mendes (孟必思), CC BY-SA 4.0, via Wikimedia Commons