Taiwanese chipmaker Powerchip Semiconductor Manufacturing Corp. and Japanese financial firm SBI Holdings said Tuesday they have selected Miyagi Prefecture in northern Japan as the location for a $5.4 billion (¥811 billion) planned foundry.
While the project has yet to receive government subsidies, talks have been progressing this month in what would become the latest commitment by Taiwanese chipmakers to manufacturing in Japan.
Powerchip said it aimed to manufacture microcontrollers and power chips that are needed for power management in electric vehicles, along with chips for artificial intelligence.
In the first $2.8 billion phase, planned for 2027, the foundry will manufacture chips using 40-nanometer and 55-nanometer technology with a targeted monthly output of 10,000 wafers. The second phase, planned for two years later, aims to introduce 28-nanometer technology with a targeted monthly output of 40,000 wafers.
The fab will be located at an industrial park that has abundant land, water and power neighboring the major regional city of Sendai, the companies said.
Powerchip and SBI announced its plan to build a fab in July and received proposals from more than 30 local governments from the northern island of Hokkaido to the major chipmaking center of Kyushu, the two companies said.
Japan is seeing a flurry of investment in chipmaking as the government offers generous subsidies to companies such as homegrown foundry venture Rapidus and Taiwan's leading contract chipmaker TSMC.