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News Article

TSMC, Sony Considering Joint Semiconductor Factory in Japan

By Antonio Gozain | Fri, 10/08/2021 - 16:18

Taiwan Semiconductor Manufacturing Company (TSMC) and Sony Group are currently discussing a joint venture project to build a semiconductor factory in Japan, with the government expected to invest half of the total JPY$800 billion (US$7.15 billion) needed for the project, reported Nikkei Asia.

The plant, to be located in Kumamoto, southern Japan, will produce semiconductors for vehicles, camera image sensors and other products for various industries, which have been hit by global shortages. The factory is expected to start operations in 2024, reported Reuters.

The automotive industry is paralyzed across the world due to chip shortages. While the US promoted the “CHIPS for America Act” initiative to attract investment above US$75 billion to boost semiconductor production in the country, shortages will continue for the next 12 to 18 months, along with pandemic-related disruptions and other supply chain bottlenecks, said during Mexico Automotive Summit 2021 ECHO Guido Vildozo, Senior Manager, Americas Light Vehicle Sales Forecasting at IHS Markit.

The industry is moving forward and automotive innovations today come from electronics rather than mechanics. As automakers speed up toward CASE mobility, semiconductor chips have become essential. A single alteration in the supply chain can have a massive impact on the entire sector. “The entire (automotive) industry relies on the big semiconductor manufacturers in Asia. The majority of manufacturers specialized in the auto sector are located in Taiwan, where they have been attracting investment and building an ecosystem for years. It is a very complex technology,” said to MBN Manuel Montoya, President of the Automotive Cluster Network.

The Japanese government is mindful of economic security and supply chain stability, which is why it plans to subsidize the project. In exchange, the government “will seek a commitment that chip supplies to the Japanese market take priority,” reported Nikkei. By accepting direct investment from TSMC, Japan “hopes to revive the production of advanced products in the country.”

TSMC has the largest share of the global market in contract manufacturing and its presence is growing. The Taiwanese company is currently building a US$12 billion factory in Arizona, following the US’s investment-attraction initiative.

Ford to Temporarily Suspend Production at Sonora Plant

For the second time in the year, Ford will temporarily suspend production at its plant in Hermosillo, Sonora, on Oct. 11 and 12, 2021, due to material shortages, reported El Economista. The specific material in short supply was not specified, however. "The production halt is reported on Monday, Oct. 11 and Tuesday, Oct. 12 for both shifts due to lack of material," said the statement published by Ford’s union, which also informed that workers will be paid 75 percent of their salaries on those days.

The data used in this article was sourced from:  
MBN, Nikkei Asia, Reuters, El Economista
Antonio Gozain Antonio Gozain Journalist and Industry Analyst