Taiwan Semiconductor Manufacturing Company (TSMC) is significantly expanding its presence in Japan, reinforcing the country’s role in the global semiconductor supply chain. The world’s largest chipmaker is not only operating its first Japanese fabrication plant but is already planning a second, demonstrating a commitment to the region that exceeds $20 billion with substantial support from the Japanese government.
First Plant Now in Mass Production
TSMC officially opened its first semiconductor plant in Japan on , in Kikuyo town, a suburb of Kumamoto, southwestern Japan. Operated by Japan Advanced Semiconductor Manufacturing (JASM), a subsidiary majority-owned by TSMC, the facility began mass production in December . This milestone is a key step in TSMC’s broader global expansion strategy.
Second Fab Planned to Meet Rising Demand
Responding to increasing customer demand, TSMC announced on , its intention to build a second semiconductor fabrication plant in Japan. JASM will begin construction of the second fab by the end of , with operations expected to commence by the end of . The combined investment from both plants will surpass $20 billion, bolstered by strong financial backing from the Japanese government.
Strategic Partnerships and Job Creation
The venture has attracted investment from major Japanese corporations, including Toyota Motor and Sony. The two plants are projected to create approximately 3,400 skilled jobs, contributing to the growth of Japan’s semiconductor workforce. This investment signifies a collaborative effort to strengthen Japan’s position in the highly competitive semiconductor industry.
Global Expansion Amidst Challenges
TSMC’s expansion into Japan is occurring alongside other significant investments, including a substantial project in Arizona. However, the Arizona project has faced delays. Originally slated to begin operation in , the facility is now expected to be operational in or . Despite these challenges, TSMC remains committed to diversifying its manufacturing locations and bolstering its global capacity.
Dominant Market Position
Based in Hsinchu, Taiwan, TSMC currently produces an estimated 90% of the world’s most advanced semiconductors. The company supplies critical components to global technology leaders such as Apple and Nvidia, playing a vital role in the production of a vast array of devices, from smartphones to washing machines. The expansion in Japan is a strategic move to address growing global demand and mitigate potential risks associated with concentrating production in a single geographic location.
Supply Chain Management Focus
TSMC’s commitment to strengthening its supply chain was highlighted by the 2025 Supply Chain Management Forum, where the company presented awards to outstanding suppliers. This focus on supply chain resilience is a key component of TSMC’s long-term strategy.
Implications for the Semiconductor Industry
TSMC’s increased investment in Japan represents a significant development for the semiconductor industry. It underscores the growing importance of geographic diversification in semiconductor manufacturing, driven by geopolitical considerations and the need for supply chain security. The collaboration between TSMC, the Japanese government and Japanese corporations demonstrates a concerted effort to build a robust and resilient semiconductor ecosystem in Japan. The success of these ventures will be closely watched by industry observers as a model for future international collaborations in the semiconductor space.
As of today, , the first plant is in mass production and the second is under planning, with construction expected to begin before the end of the year. The long-term impact of these investments on the global semiconductor landscape remains to be seen, but they undoubtedly position Japan as a key player in the future of chip manufacturing.
