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TSMC to Launch Kumamoto Fab, Bolstering Global Semiconductor Supply Chain

The new Japanese facility aims for Q4 mass production, enhancing TSMC's capacity amidst geopolitical and supply chain demands
Taiwan
t 2330.TW Blue Chip 150 Tech 350 Semicon 75
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Taiwan Semiconductor Manufacturing Company (TSMC) is set to inaugurate its Kumamoto fabrication plant in Japan on February 24, with plans to commence mass production in the fourth quarter. This strategic move is part of TSMC’s broader effort to diversify its manufacturing footprint and bolster supply chain resilience in response to geopolitical tensions and customer demands.

The Kumamoto facility, alongside TSMC’s ventures in Arizona, USA, and Dresden, Germany, represents a significant expansion of the company’s global operations. The Arizona site is slated to start mass-producing the 4nm process in early 2025, while the Kumamoto plant will focus on 12nm to 28nm processes, marking TSMC’s first mass-produced overseas fab in its latest expansion wave.

Industry analysts, including Yang Ruilin of the International Institute of Obstetrics and Mechanics at ITRI, attribute the rapid development of the Kumamoto plant to several factors: substantial local government subsidies, a robust local supply chain, and relatively lower operating costs compared to other international locations. Japan’s strong semiconductor supply chain infrastructure, renowned for its high-quality equipment and materials, plays a crucial role in the facility’s swift progress to mass production.

The establishment of the Kumamoto plant is a testament to TSMC’s commitment to meeting its customers’ needs for supply chain diversification and geopolitical stability. As TSMC’s largest market, the United States remains a focal point for the company’s global strategy. However, the Kumamoto facility’s strategic importance may grow, potentially serving as a key supply source for both the U.S. and German markets, depending on the scale and speed of future expansions influenced by government subsidies and local demand.

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