After TSMC fab in Japan, advanced packaging facility is next
Japan’s efforts to reboot its chip industry are likely to get another boost: an advanced packaging facility set up by TSMC. That seems a logical expansion to TSMC’s $7 billion front-end chip manufacturing fab built in Kumamoto on Japan’s southern island Kyushu.
In other words, a back-end packaging facility will follow the front-end fab to complement the chip manufacturing ecosystem in Japan amid considerations to diversify semiconductor supply chains beyond Taiwan due to geopolitical tensions. Trade media has been abuzz about TSMC setting up an advanced packaging plant and a new Reuters report supports this premise.
Especially when TSMC has already set up an advanced packaging R&D center in Ibaraki prefecture, northeast of Tokyo, in 2021. The demand for advanced semiconductor packaging has surged due to high-end chips serving artificial intelligence (AI) and high-performance computing (HPC) applications. The rise of chiplets has also brought advanced packaging technologies into the limelight.
The above factors call TSMC, the world’s largest semiconductor factory, to plan additional packaging capacity; in fact, it’s already working to set up a new packaging facility in Chiayi, southern Taiwan. However, as TrendForce analyst Joanne Chiao notes, TSMC’s advanced packaging facility in Japan will likely be limited in scale. That’s mainly because most of TSMC’s packaging customers are based in the United States.
Figure 1 TSMC’s advanced packaging technology encompasses front-end 3D stacking techniques such as chip-on-wafer (CoW) and wafer-on-wafer (WoW) as well as back-end packaging technologies like integrated fan-out (InFO) and chip-on-wafer-on-substrate (CoWoS). Source: TSMC
with this new plant, TSMC’s CoWoS packaging technology will be transferred to Japan. It’s a 2.5D wafer-level packaging technology developed by TSMC that allows multiple dies to be integrated on a single substrate, providing higher performance and integration density than traditional packaging technologies. Currently, TSMC’s CoWoS packaging capacity is entirely based in Taiwan.
Figure 2 In CoWoS, multiple silicon dies are integrated on a passive silicon interposer, which acts as a communication layer for the active die on top. Source: TSMC
On TSMC’s part, the packaging facility in Japan will have closer access to the country’s leading semiconductor materials and equipment suppliers and a solid customer base. TSMC will also enjoy the generous subsidies from the Japanese government, which aims to revitalize the local semiconductor industry after losing ground to South Korea and Taiwan.
Finally, as the Reuters report notes, no decision on the scale and timeline of building the advanced packaging facility has been made yet. TSMC also declined to comment on this story. Still, with the construction of the TSMC fab in Kumamoto, industry observers firmly believe that Taiwan’s mega fab will inevitably set up an advanced packaging facility in Japan.
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