Japan's $10 Billion Bet: Fueling Rapidus' Race to 2nm Chip Supremacy
1min read The Japanese government is taking decisive steps to bolster its semiconductor industry by allocating approximately $10 billion to enhance chip production and artificial intelligence (AI) infrastructure. This substantial investment forms part of a supplementary budget for the fiscal year, focusing heavily on aiding local semiconductor enterprises such as Rapidus.
Rapidus, a domestic chip manufacturer established in August 2022 through partnerships with prominent companies like Toyota, Sony, and NEC, is set to receive an additional subsidy of 800 billion yen. This funding aims to support the company's ambitious plan to mass-produce 2nm chips by 2027. While the projected cost for this initiative is around 5 trillion yen, the government's support, totaling 920 billion yen, still leaves a significant funding gap. These additional funds will be channeled into research, development, and operational capital.
In August, Rapidus announced that construction of its 2nm wafer factory is progressing as scheduled, with preliminary production set to commence in April 2025. The facility, located in northern Japan, will utilize robots and AI to establish a fully automated 2nm production line. This automation is expected to significantly reduce production time, enabling Rapidus to deliver chips in one-third of the time compared to its rivals.
Rapidus's automated facility is poised to offer a strategic advantage over existing manufacturing plants. Chief Executive Officer Atsuyoshi Koike emphasized that the move towards automation will enhance performance and reduce delivery times for their 2nm products, setting a new standard in semiconductor manufacturing.
In the broader scope, Japan's economic strategy includes a massive commitment to advancing its semiconductor and AI sectors, embedding these initiatives within its economic stimulus plan. A total of 10 trillion yen is earmarked for public support towards semiconductor-related industries by 2030, nurturing next-generation semiconductor research through substantial subsidies and encouraging private investment to fill existing financial gaps in production capabilities.