Sony and TSMC may team up to tackle global chip shortages

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Tech giants considering new chip factory

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Taiwanese tech powerhouse TSMC and Japan’s giant Sony are reportedly joining forces to build a chip factory in the latter’s home country. 

According to Nikkei reports, the two companies, together with several other partners (including the Japanese government) want to try and alleviate some of the pressure created by the acute chip shortage that came as a side-effect of the Covid-19 pandemic, as well as creating a contingency plan in case China makes any sudden moves against Taiwan.

The factory would cost approximately $7 billion, with the Japanese government allegedly interested in covering half of the expenses. TSMC would have majority control, while Sony would provide the real estate needed to build the factory. The two would build chips for all kinds of devices, including cars, which is why car parts maker Denso is also apparently interested in taking part in the project.

If all goes according to plan, the factory would be up and running by 2024. Given that the chip shortage is expected to last at least until 2023 (if the demand remains at current levels), the duo could make it to the market just in time to help the wider market bounce back from Covid and add much-needed stability. 

China destabilizing

Furthermore, the relationship between China and neighboring Taiwan is all but stable right now, and the fact that most of the chip manufacturing is concentrated in China has TSMC worried.

So far, both companies have refused to comment, but the media argue that such a move would make perfect sense, if nothing than from an economic perspective. By 2024, highly connected, semi-autonomous vehicles should no longer be a novelty. And, with the proliferation of IoT, and the ever-growing market of mobile devices and smartphones, as well as the expanding reach of 5G tech, the demand for chips will only grow.

Via Nikkei

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Sead Fadilpašić

Sead is a seasoned freelance journalist based in Sarajevo, Bosnia and Herzegovina. He writes about IT (cloud, IoT, 5G, VPN) and cybersecurity (ransomware, data breaches, laws and regulations). In his career, spanning more than a decade, he’s written for numerous media outlets, including Al Jazeera Balkans. He’s also held several modules on content writing for Represent Communications.