TSMC weighs adding AI chip production at Japan's Kumamoto plant

Core Viewpoint - Taiwan Semiconductor Manufacturing Co. (TSMC) is exploring the production of artificial intelligence-related semiconductors at its Kumamoto plant in Japan, indicating a strategic shift towards AI technology in response to market demands [1][5]. Group 1: Production Plans - TSMC is coordinating the introduction of 4-nanometer manufacturing tools for AI applications at the Kumamoto facility, which currently produces chips in the 12 nm to 28 nm range for automotive uses [2]. - The first plant in Kumamoto began operations late last year, while a second plant is scheduled to start in 2027, initially intended to produce chips in the 6 nm to 40 nm range [3][4]. Group 2: Market Dynamics - The demand for semiconductors has been affected by a slowdown in global electric vehicle sales, leading to lower utilization rates at the first plant [3]. - The construction of the second plant has been effectively paused, and the shift towards AI-related production may further delay its planned start date [4]. Group 3: Strategic Importance - The domestic production of AI chips in Kumamoto could enhance Japan's supply stability amid increasing global competition for advanced AI semiconductors, particularly those used in products from companies like Nvidia [5]. - Analysts emphasize the importance of establishing an onshore supply chain for AI semiconductors to strengthen Japan's industrial competitiveness [6].