TSMC to Build Chip Fab in Japan

Japanese government helps subsidize project as chip shortage threatens economies around the world

3 min read
Foreground is a phone with the tsmc logo of tsmc in red and a circular semiconductor fab. Background is the same logo.
Pavlo Gonchar/Sipa/AP

After a week of media rumor, leaks and speculation, Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chip manufacturer, announced in an online earnings briefing Thursday that it would build a semiconductor plant in Japan. The announcement comes just a few months after the chip giant announced its intention to build a $12 billion fab in Arizona. Construction will begin next year, the company said, subject to approval by TSMC's board, with full production expected to begin in 2024.

"The plant will use 22- and 28-nanometer line processing," said Tadahiro Kuroda, Director of Systems Design Lab (d.lab) at the Graduate School of Engineering, the University of Tokyo. "So it's not an advanced foundry like the Arizona plant that will use 7 nanometers." But he adds it can produce a range of devices that go into consumer products, sensors, IoT, and auto parts.

During the earnings briefing C.C. Wei, TSMC's CEO, said the company had received help from its Japanese customers and the government to establish the plant in Japan. Wei did not reveal the amount of investment or the fab's planned location.

The projected plant's 22 and 28-nanometer processes will produce a range of devices suitable for consumer products, sensors, IoT, and auto parts.

But Japan Prime Minister Fumio Kishida said in the Diet (Parliament) the same day of the announcement that investment would be about one trillion yen (almost $8.8 billion) and the government would provide financial aid. An earlier report by Nikkei, Japan's top business publication, citing "multiple people familiar with the matter," said the plant would be located in Kumamoto Prefecture, western Japan, "on land owned by Sony and in an area adjacent to the latter's image sensor factory."

That report would make sense, says Kuroda, because Sony is TSMC's biggest customer in Japan.

The announcement comes as the global semiconductor supply chain is buffeted by a perfect storm that began brewing several years ago when the U.S.-China trade war erupted. Since then, the world economy has taken a battering from COVID-19, conflict is growing between Taiwan and China in the Taiwan Strait separating the island from mainland China, and a global chip shortage is now hurting production plans of even the world's largest corporations. This week, it was reported that Apple is likely to cut production of its new iPhone 13 output this year by as many as 10 million devices because of a lack of chips. Earlier, on September 10, Toyota announced it was "making further adjustments to our production operations," an outcome that saw its global output fall by 70,000 units in September, to be followed by 330,000 units cut for October. Toyota blames the effects of the pandemic and semiconductor shortages.

The shrinking availability of chips and its negative impact on industries at large has underscored how dependent Europe, the U.S. and Japanese economies have become on semiconductor devices predominantly made in China, Taiwan, and South Korea. Not surprisingly, serious efforts are underway to reduce this vulnerability.

In May, Gina Raimondo, the U.S. Commerce Secretary, proposed additional funding of $52 billion on semiconductor research and production. A boost that could see as many as ten new foundries built in the U.S. Europe, too, is making similar noise. Last December, 22 members of the E.U. declared they would work together to reinforce "Europe's capabilities in semiconductor technologies," including "investment along the semiconductor value chain on equipment and materials, design and advanced manufacturing."

Not wanting to be left behind in this silicon turnabout, the Japan government too is seeking ways to boost the country's chip production capacity. The day before the TSMC announcement, Kishida told the Diet he would "promote the establishment of chip production bases in Japan and implement solid measures to strengthen the supply chain for semiconductors."

"In fact, TSMC is only part of the government's strategy," notes Kuroda. "They would also like Intel and other major U.S. chip manufacturers to set up plants here."

Kuroda spent 16 years in Toshiba's semiconductor division before coming to academia to conduct engineering research. Given his background, he was asked by the University of Tokyo (UTokyo), Japan's leading national institute of higher learning, to join it and help set up in November 2019 an alliance with TSMC to conduct advanced semiconductor research.

TSMC, says Kuroda, has 7 nm process technology that Japan wants, while Japan's academia is advanced in basic research in physics, chemistry, and materials. "This knowledge will be needed," says Kuroda, "to create future devices after Moore's Law ends, so we are collaborating together."

To facilitate the exchange of knowhow, UTokyo has set up two organizations to work with domestic manufacturers: the Research Association for Advanced Systems (RaaS), which has restricted membership, and d.lab, which is open to all. Kuroda is both the chairman of RaaS, and the director of d.lab.

"RaaS is kind of a bi-directional gateway," Kuroda explains. TSMC gains fundamental science knowledge to help it build more advanced chips. Also, in making available its 7 nm knowhow, it can cultivate new customers for its services in Japan. At the same time, "RaaS members like Hitachi, Panasonic and Toppan get access to TSMC knowhow," he says. "This makes it a win-win for both sides."

The Conversation (0)

The Inner Beauty of Basic Electronics

Open Circuits showcases the surprising complexity of passive components

5 min read
A photo of a high-stability film resistor with the letters "MIS" in yellow.
All photos by Eric Schlaepfer & Windell H. Oskay

Eric Schlaepfer was trying to fix a broken piece of test equipment when he came across the cause of the problem—a troubled tantalum capacitor. The component had somehow shorted out, and he wanted to know why. So he polished it down for a look inside. He never found the source of the short, but he and his collaborator, Windell H. Oskay, discovered something even better: a breathtaking hidden world inside electronics. What followed were hours and hours of polishing, cleaning, and photography that resulted in Open Circuits: The Inner Beauty of Electronic Components (No Starch Press, 2022), an excerpt of which follows. As the authors write, everything about these components is deliberately designed to meet specific technical needs, but that design leads to “accidental beauty: the emergent aesthetics of things you were never expected to see.”

From a book that spans the wide world of electronics, what we at IEEE Spectrum found surprisingly compelling were the insides of things we don’t spend much time thinking about, passive components. Transistors, LEDs, and other semiconductors may be where the action is, but the simple physics of resistors, capacitors, and inductors have their own sort of splendor.

High-Stability Film Resistor

A photo of a high-stability film resistor with the letters "MIS" in yellow.

All photos by Eric Schlaepfer & Windell H. Oskay

This high-stability film resistor, about 4 millimeters in diameter, is made in much the same way as its inexpensive carbon-film cousin, but with exacting precision. A ceramic rod is coated with a fine layer of resistive film (thin metal, metal oxide, or carbon) and then a perfectly uniform helical groove is machined into the film.

Instead of coating the resistor with an epoxy, it’s hermetically sealed in a lustrous little glass envelope. This makes the resistor more robust, ideal for specialized cases such as precision reference instrumentation, where long-term stability of the resistor is critical. The glass envelope provides better isolation against moisture and other environmental changes than standard coatings like epoxy.

15-Turn Trimmer Potentiometer

A photo of a blue chip
A photo of a blue chip on a circuit board.

It takes 15 rotations of an adjustment screw to move a 15-turn trimmer potentiometer from one end of its resistive range to the other. Circuits that need to be adjusted with fine resolution control use this type of trimmer pot instead of the single-turn variety.

The resistive element in this trimmer is a strip of cermet—a composite of ceramic and metal—silk-screened on a white ceramic substrate. Screen-printed metal links each end of the strip to the connecting wires. It’s a flattened, linear version of the horseshoe-shaped resistive element in single-turn trimmers.

Turning the adjustment screw moves a plastic slider along a track. The wiper is a spring finger, a spring-loaded metal contact, attached to the slider. It makes contact between a metal strip and the selected point on the strip of resistive film.

Ceramic Disc Capacitor

A cutaway of a Ceramic Disc Capacitor
A photo of a Ceramic Disc Capacitor

Capacitors are fundamental electronic components that store energy in the form of static electricity. They’re used in countless ways, including for bulk energy storage, to smooth out electronic signals, and as computer memory cells. The simplest capacitor consists of two parallel metal plates with a gap between them, but capacitors can take many forms so long as there are two conductive surfaces, called electrodes, separated by an insulator.

A ceramic disc capacitor is a low-cost capacitor that is frequently found in appliances and toys. Its insulator is a ceramic disc, and its two parallel plates are extremely thin metal coatings that are evaporated or sputtered onto the disc’s outer surfaces. Connecting wires are attached using solder, and the whole assembly is dipped into a porous coating material that dries hard and protects the capacitor from damage.

Film Capacitor

An image of a cut away of a capacitor
A photo of a green capacitor.

Film capacitors are frequently found in high-quality audio equipment, such as headphone amplifiers, record players, graphic equalizers, and radio tuners. Their key feature is that the dielectric material is a plastic film, such as polyester or polypropylene.

The metal electrodes of this film capacitor are vacuum-deposited on the surfaces of long strips of plastic film. After the leads are attached, the films are rolled up and dipped into an epoxy that binds the assembly together. Then the completed assembly is dipped in a tough outer coating and marked with its value.

Other types of film capacitors are made by stacking flat layers of metallized plastic film, rather than rolling up layers of film.

Dipped Tantalum Capacitor

A photo of a cutaway of a Dipped Tantalum Capacitor

At the core of this capacitor is a porous pellet of tantalum metal. The pellet is made from tantalum powder and sintered, or compressed at a high temperature, into a dense, spongelike solid.

Just like a kitchen sponge, the resulting pellet has a high surface area per unit volume. The pellet is then anodized, creating an insulating oxide layer with an equally high surface area. This process packs a lot of capacitance into a compact device, using spongelike geometry rather than the stacked or rolled layers that most other capacitors use.

The device’s positive terminal, or anode, is connected directly to the tantalum metal. The negative terminal, or cathode, is formed by a thin layer of conductive manganese dioxide coating the pellet.

Axial Inductor

An image of a cutaway of a Axial Inductor
A photo of a collection of cut wires

Inductors are fundamental electronic components that store energy in the form of a magnetic field. They’re used, for example, in some types of power supplies to convert between voltages by alternately storing and releasing energy. This energy-efficient design helps maximize the battery life of cellphones and other portable electronics.

Inductors typically consist of a coil of insulated wire wrapped around a core of magnetic material like iron or ferrite, a ceramic filled with iron oxide. Current flowing around the core produces a magnetic field that acts as a sort of flywheel for current, smoothing out changes in the current as it flows through the inductor.

This axial inductor has a number of turns of varnished copper wire wrapped around a ferrite form and soldered to copper leads on its two ends. It has several layers of protection: a clear varnish over the windings, a light-green coating around the solder joints, and a striking green outer coating to protect the whole component and provide a surface for the colorful stripes that indicate its inductance value.

Power Supply Transformer

A photo of a collection of cut wires
A photo of a yellow element on a circuit board.

This transformer has multiple sets of windings and is used in a power supply to create multiple output AC voltages from a single AC input such as a wall outlet.

The small wires nearer the center are “high impedance” turns of magnet wire. These windings carry a higher voltage but a lower current. They’re protected by several layers of tape, a copper-foil electrostatic shield, and more tape.

The outer “low impedance” windings are made with thicker insulated wire and fewer turns. They handle a lower voltage but a higher current.

All of the windings are wrapped around a black plastic bobbin. Two pieces of ferrite ceramic are bonded together to form the magnetic core at the heart of the transformer.

This article appears in the February 2023 print issue.