japan challenges semiconductor giants with 2nm chip production
Tokyo, Friday, 10 January 2025.
Japan’s Rapidus is set to shake up the semiconductor industry with plans to produce 2nm chips by 2027. This bold move positions Japan as a formidable competitor against industry leaders like TSMC. With pilot production starting in April, Rapidus is not only targeting significant market share but also signaling a shift in the global semiconductor landscape. The collaboration with Broadcom and the potential to secure major clients like Meta and Alphabet highlight Rapidus’s ambition. This development could influence TSMC’s market performance and alter the competitive dynamics of chip production globally. The stakes are high as Japan aims to establish itself as a key player in advanced chip manufacturing, leveraging partnerships and technological advancements.
Strategic market entry timeline
Rapidus, Japan’s emerging semiconductor manufacturer, has unveiled an ambitious roadmap for entering the advanced chip market. The company will initiate trial production of 2nm chips in April at their Chitose City facility [1][2]. A crucial milestone is set for June when Rapidus will provide sample chips to Broadcom [1][3]. The company aims to achieve full-scale production by 2027 [1][2], backed by a substantial investment of ¥5 trillion (approximately $32 billion) [2].
Technical capabilities and partnerships
The Japanese chip maker has secured critical technological support through strategic partnerships. Rapidus is collaborating with IBM for 2nm chip production technology [3]. The company expects to complete the installation of its first EUV (Extreme Ultraviolet) lithography machine from ASML by March 2025 [2][3]. This technological foundation positions Rapidus to potentially compete with established players in the semiconductor industry [1].
Market implications and competitive landscape
The entry of Rapidus could significantly impact TSMC’s market position, particularly as TSMC plans to begin mass production of 2nm chips later this year [3]. Notably, Nvidia CEO Jensen Huang has expressed interest in potential collaboration with Rapidus for AI chip manufacturing [3]. The company is currently in discussions with 30-40 potential clients [5], focusing on customized, small-batch production orders to differentiate itself from TSMC’s mass production model [5].
Corporate backing and government support
Rapidus benefits from strong corporate and government backing. Established in 2022, the company is supported by major Japanese corporations including Toyota, Sony, and SoftBank [3]. The venture received initial government funding of ¥70 billion [2]. This support is part of Japan’s broader strategy to revitalize its semiconductor industry, marked by the establishment of the Leading-edge Semiconductor Technology Center in November 2022 [2].