Samsung Invests In Japan Facility To Take On Taiwan Semiconductor In Chip Packaging

Samsung Electronics SSNLF earmarked 25 billion yen ($170 million) to establish an advanced chip packaging R&D center in Yokohama, Japan, intensifying its competition with Taiwan Semiconductor Manufacturing Co TSM in the packaging market.

The global advanced chip packaging market is forecast to grow from $34.5 billion in 2023 to $80 billion by 2032.

The lab, scheduled to open in March 2027, will strengthen Samsung's collaboration with Japanese semiconductor material and equipment suppliers, such as Disco, Namics, and Rasonac, and the University of Tokyo, the Korea Economic Daily reported on Wednesday.

Also Read: Taiwan Semiconductor Eyes Rollout Of 2nm Advanced Tech Chips This Year

The City of Yokohama will provide a 2.5 billion yen subsidy for the project, housed in the Leaf Minato Mirai building, a former retail property converted into R&D space and pilot production lines.

Samsung purchased the 47,710-square-meter facility and plans to hire researchers from the University of Tokyo to advance its advanced packaging capabilities.

Although Taiwan Semiconductor leads the market with a 35.3% share, Samsung holds 5.9%. It recently secured a $16.5 billion foundry contract for Tesla's TSLA AI6 chips.

Ming-Chi Kuo called the deal a rare, "valuable opportunity" for Tesla to gain real-world foundry experience, boosting its chip design and manufacturability skills while giving it more leverage in future negotiations.

Although Samsung's 2nm yield of 40–45% trails Taiwan Semiconductor, Kuo said the upside outweighs the risk, with Tesla able to shift production back to Taiwan Semiconductor if needed.

Chamath Palihapitiya said the deal cements Tesla's role as the only company tying physical and software AI together at scale. Gene Munster noted AI6 will enable more advanced capabilities for Tesla's Robotaxi, Full Self-Driving, and Optimus programs by 2027.

Meanwhile, Taiwan Semiconductor is pressing ahead with expansion. The company will break ground on four new fabrication plants later this year, with plans to begin mass production of 2nm chips by late 2028, according to Central Taiwan Science Park Bureau Director-General Hsu Maw-shin.

Its upcoming Fab 25 will feature four 1.4nm wafer lines, with risk assessments expected to conclude in 2027 and a targeted monthly output of 50,000 wafers.

TSM Price Action: Taiwan Semiconductor stock is trading lower by 0.46% to $239.90 premarket at last check Friday.

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