GLOBALIZATION 

Taiwan’s Powerchip Teams Up With SBI to Build Japan Foundry

Komaki Ito and Yuki Furukawa
Wed, July 5, 2023 




(Bloomberg) -- Taiwan’s Powerchip Semiconductor Manufacturing Corp. and investment firm SBI Holdings Inc. are teaming up to build a foundry in Japan to meet growing demand by manufacturers to source chips locally.

SBI will help raise funds for the new venture, which plans to begin with 40-nanometer and 55nm automotive and industrial chips and produce more advanced 28nm chips in the medium-to-longterm, according to SBI President Yoshitaka Kitao.

Details on the timing and location of the factory remain undecided, he said at a news conference Wednesday. The world’s leading contract chipmaker Taiwan Semiconductor Manufacturing Co. is building a plant in southwest Japan expected to go online as early as next year.

“The most important thing is how they will recover their investment,” said Masayuki Otani, chief market analyst at Securities Japan Inc. Shares in SBI closed up 2% after the announcement, while Powerchip rose 2.3%.

Tokyo-based SBI is eyeing the growing financing needs of chipmakers to create redundant production lines as manufacturers bow to political and investor pressure to diversify their suppliers. SBI will help the chip venture raise funds globally and consider measures including issuing municipal bonds and securing Japanese regional bank loans.

“Our priority is Japan,” Powerchip Chairman Frank Huang said, noting that the weak yen, lower labor costs and favorable financing now make Japan attractive as a production site.

Prime Minister Fumio Kishida is betting shifting geopolitical priorities will help Japan regain some of its long-lost leadership in semiconductors. Japan’s preparing billions of dollars in subsidies as part of a push to triple domestic production of chips by 2030. Such efforts are not enough, Kitao said.

“The government has spent ¥2 trillion over the past two years to develop domestic chip manufacturing capacity, but I think that’s too little,” Kitao said. “We want to help revive Japan’s chip industry.”

--With assistance from Takako Taniguchi.