Japan’s Push to Revitalize Its Chip Sector

Once a global leader in chip manufacturing, Japan’s market share has now dropped to around 10% from 50% in the late 1980s. To counter this trend, the country is striving to rejuvenate its chip sector. It’s bolstering advanced chip-making capabilities at home and seeking alliances to counter China’s advancements in chip and other advanced technologies.

Micron Technologies is set to become the first corporation to bring Extreme Ultraviolet Lithography (EUV) production to Japan. EUV, a game-changing technology in the cutting-edge world of semiconductor device fabrication, is at the heart of Micron’s bold plan. The company intends to invest as much as 500 billion yen ($3.6 billion) into EUV to manufacture the next generation of dynamic random access memory (DRAM), also known as 1-gamma chips, at its Hiroshima facility.

DRAM: The Future of Memory

For those not in the know, DRAM chips are vital components in digital electronics, offering high-capacity memory at a low cost. Micron’s CEO, Sanjay Mehrotra, expressed pride in leading the introduction of EUV technology in Japan, emphasizing Micron’s continued commitment to the nation. Mehrotra noted the company’s strong relationship with the Japanese government and praised the exceptional talent of the Micron Hiroshima team.

A Necessity Born from a Global Chip Shortage

The backdrop to this investment is a worldwide chip shortage and a rising US-China chip conflict, which has left many countries struggling. To combat these challenges, many governments, including Japan’s, are working on boosting their domestic chip manufacturing capabilities. Japan’s government has committed significant financial backing for next-gen chip development and manufacturing, including a partnership with Rapidus to create 2nm chips by 2025.

Prior Successes Fueling Micron’s Ambitious Plans

Micron’s latest investment in Japan follows the company’s announcement last year to build the largest-ever US semiconductor factory in New York, a $20 billion investment. They also began construction on a memory manufacturing facility in Boise, Idaho. The recent CHIPS and Science Act, which allocated $50 billion, has breathed new life into the US semiconductor manufacturing industry. This came at a critical time as the US’s market share has been dwindling in recent years.

Prime Minister Kishida’s Bold Move: Seeking Global Support

Amid this backdrop, Prime Minister Fumio Kishida recently convened a meeting with top executives from the world’s largest chipmakers, including Intel Corp., Taiwan Semiconductor Manufacturing Co. (TSMC), Samsung Electronics Co., Micron Technology Inc., and IBM. This meeting underscored Japan’s effort to bolster semiconductor manufacturing capacity domestically while reducing reliance on Taiwan.