Connect with us

Economy & Tech

Leading Japanese Companies Cooperate in Drive to Produce Next-Generation Chips

Japan produced about half of next-generation chips in its semiconductor output into the 1980S, but its share of the market has been steadily declining since.



semiconductor technology
Semiconductor chip (© Reuters via Kyodo)

Around ten Japanese companies, including Toyota Motor Corporation, NTT and the Sony Group have joined hands in a venture to mass produce next-generation chips for use in cutting-edge products such as supercomputers and AI, it was learned on November 10. 

The new company hopes to have its semiconductor manufacturing technology in place by the late 2020s. With the competition among several nations to develop next-generation chips heating up, this "All Japan" effort intends to go toe-to-toe with foreign rivals. 

The new company will be called Rapidus, which means "rapid" in Latin. The companies taking a stake in Rapidus, which include NEC, SoftBank, Denso, chipmaker Kioxia Holdings and Mitsubishi UFJ Bank, will each reportedly invest between several hundred million yen and one billion JPY (roughly $720,000 ~ $7 million USD). 

With semiconductors, the narrower the circuit, the more information can be processed, thus reducing electricity consumption. The new company will focus on producing "logic semiconductors" used in calculating. 

Currently, the mass-produced logic scaling chips with the narrowest width measurement are 3 nanometers (nm, one nano = one thousand-millionth of a meter). Rapidus hopes to improve on this and develop technology for manufacturing 2 nm products. 

Toyota logo

Fast Track Project

The company hopes to have a production lineup and be up and running in the late 2020s and start a contract semiconductor manufacturing business around 2030.

Also, in collaboration with the University of Tokyo, the Tokyo Institute of Technology and other academic institutions, the company intends to establish a research and development (R&D) center by the end of 2022. Cooperation with the United States is also being eyed.

The Japanese government is considering providing around ¥70 billion JPY (over $500 million USD) in support for the new company and the yet-to-be-established R&D facility. 

Prompted by Geopolitical Concerns

The move comes as consciousness of geopolitical risk and economic security is rising in the semiconductor industry. In particular, problems regarding the flow of sensitive technologies to China and the concentration of cutting-edge product manufacturing in Taiwan and other countries are attracting greater attention. 

Increasingly amidst this challenging environment, governments have been shifting towards domestic production and boosting their support for state-of-the-art technologies. 

In August a new law was adopted in the United States which will provide $52.7 billion USD for semiconductor production and R&D. Furthermore, on October 7, the Biden Administration announced more stringent export restrictions on the US products shipped to China. 

Taiwan Semiconductor Manufacturing Company Limited (TSMC), Fab 5 building, Hsinchu Science Park, Taiwan (Pellden)

Japan's Response

The Japanese government too is supporting new factory construction in Japan via a  ¥617.0 billion JPY ($4.5 billion USD) special fund. To date it has helped finance 3 projects, including a new factory built in Kumamoto Prefecture by Taiwan Semiconductor Manufacturing (TSMC). 

Nonetheless, Japan's share of the global semiconductor output has been steadily declining since the 1980s when it produced roughly half of the world's chips. As far as logic semiconductor technology is concerned, which determines the performance of such things as data centers and smartphones, Japan's presence has all but disappeared.  

TSMC and other major logic semiconductor manufacturers are already producing 3 nm products, while Japanese factories currently are only capable of producing 40 nm chips. In fact, the TSMC Kumamoto facility is not going to produce chips with smaller circuit widths than 12 nm~28 nm.

The establishment of the new company appears aimed at rectifying the situation by bringing together technologies, human resources and funding from related Japanese companies in order to rebuild a manufacturing base for advanced products in Japan.


(Read the report in Japanese at this link.)

Author: The Sankei Shimbun

Our Partners