TSMC Opens Chip Plant in Japan

TSMC's new chip plant in Japan will help assure global supplies of the crucial hardware, the Taiwanese giant's founder Morris Chang said as the $8.6-billion factory was officially opened.

Taiwan Semiconductor Manufacturing Company, which counts Apple and Nvidia as clients, produces half the world's chips, used in everything from smartphones to satellites and increasingly to power AI technology.

But TSMC's customers, as well as governments concerned about supplies of semiconductors vital to their economies and defense, want the firm to make more chips away from the self-ruled island.

China's increasing assertiveness towards Taiwan -- which it claims as its own territory and has not ruled out taking by force -- has sparked worries about the world's dependence on the island for chip production and pushed TSMC to diversify where it makes them.

The factory on the southern Japanese island of Kyushu "will, I believe, improve the resiliency of chip supply for Japan and for the world," 92-year-old Chang said at the ceremony, in a rare public appearance.

"It will also, I believe, start a renaissance of semiconductor manufacturing in Japan," Chang said.

TSMC's new facility is also a coup for Japan as it vies with the United States and Europe to woo semiconductor firms with huge subsidies.

Firms like Toshiba and NEC helped Japan dominate in microchips in the 1980s but competition from South Korea and Taiwan saw its global market share slump from more than 50 percent to around 10 percent.

Now Japan is making available up to $26.7 billion in state sweeteners to help triple the sales of domestically produced chips to more than 15 trillion yen by 2030.

The new TSMC plant in the town of Kikuyo, for which the government pledged more than 40 percent of the costs -- Sony and Denso are also on board -- is just the first.