Semiconductor Giants Compete for Ground in Japan

Global semiconductor companies are intensifying their competition for footholds in Japan, highlighted by Samsung Electronics' recent establishment of an advanced packaging research and development (R&D) center in Yokohama. Following the setup of production bases by Taiwan's TSMC in Kumamoto and the U.S.'s Micron in Hiroshima, Samsung is focusing on the Kanto region while SK Hynix is eyeing the Tohoku area for strategic locations.

According to industry sources, Samsung opened its 'Advanced Package Lab (APL)' in Yokohama, Kanagawa Prefecture, adjacent to Tokyo. The area is home to universities, research institutions, and advanced packaging material and equipment companies like Resona and Disco. Samsung plans to collaborate with over 50 local companies to expedite the development of next-generation packaging technologies through material evaluation and prototype production.

Similarly, Miyagi Prefecture is being considered as a production base for SK Hynix. The region hosts suppliers like Tokyo Electron and has a strong academic-industrial foundation with Tohoku University. Additionally, the vicinity of Sendai offers large industrial sites along with water and power infrastructure.

Notably, just north of Miyagi in Iwate Prefecture is Kioxia's Kitakami NAND factory, which SK Hynix has mentioned as a potential collaboration point. Kioxia operates this facility along with two others in Mie Prefecture and has recently announced an investment of over 1 trillion yen (approximately $8.7 billion) to build a new semiconductor plant at the Kitakami site.

SK Hynix is the largest single shareholder of Kioxia, holding 14.17% of voting rights through a special purpose company (SPC). Chey Tae-won, chairman of SK Group, has recently suggested exploring options for joint production, R&D, and supply chain sharing with Kioxia. Choosing Miyagi could allow SK Hynix to connect with the local supply chain ecosystem while avoiding overlap with existing production facilities.

Previously, TSMC established a foundry production base in Kumamoto, while Micron set up a DRAM production and R&D center in Hiroshima. The Japanese government has committed up to 1.208 trillion yen (approximately $10.3 billion) in support for TSMC's factory and up to 536 billion yen (approximately $5.7 billion) for Micron's facility. As latecomers, Samsung and SK Hynix aim to find regions that meet their specific needs for workforce, supply chain, water and power resources, and research institutions, rather than joining existing large production bases.

Lee Jong-hwan, a professor at Sangmyung University’s Department of System Semiconductor Engineering, stated, "SK Hynix appears to be pursuing a strategy to enhance its NAND competitiveness and production volume through collaboration with Kioxia, solidifying its position as the top memory producer. Meanwhile, Samsung may find it more advantageous to strengthen R&D partnerships with local suppliers that have superior technology rather than establishing production lines in Japan."