Source: Content comes from Nikkei Chinese, thank you.
Denso will contribute capital to the first semiconductor factory built by TSMC (TSMC) in Japan. The purpose is to stabilize the procurement of cutting-edge semiconductors with circuit line widths of about 10 to 20 nanometers in Japan. Denso will work with TSMC to grasp the hegemony of the automobile "CASE (connected cars, autonomous driving, shared cars, electric cars )" era.
Denso will undertake the capital increase of TSMC's semiconductor subsidiary in Kumamoto Prefecture, investing 40 billion yen in it. Second only to Sony Group, which is preparing to invest 57 billion yen, becomes the third largest shareholder of the subsidiary of TSMC, with a holding of about 10% of the shares. The new factory will be put into use in 2024 to produce cutting-edge logic semiconductors for image sensors and MCU. The total investment is expected to be 980 billion yen.
Denso is the world's second largest auto parts manufacturer, and its products range from engine parts to automotive air conditioners. He is also proficient in semiconductor for various automotive uses. Because the control engine and driving assistance function ECU (electronic control unit) are inseparable from semiconductors.
automotive cutting-edge semiconductor market will reach 3 times that of 2019 by 2030
In the group company with its largest shareholder Toyota , Denso undertakes the core part of the automotive semiconductor business. In 2020, Denso and Toyota jointly invested to establish a company that developed semiconductors and acquired the Toyota Hirose factory that manufactures semiconductors. Denso also independently produces power semiconductors and sensors used in pure electric vehicles (EV) and hybrid vehicle (HV) inverters.
On the other hand, driving assistance that automatically maintains the distance requires high calculations. Logical semiconductors responsible for high-level computing are mainly purchased from professional semiconductor manufacturers. In order to build a relationship with professional manufacturers, Denso invested 7.87% in Renesas Electronics and also invested in a small amount of stake in German Infineon Technology . TSMC is an important company that accounts for half of the world's share in the foundry field centered on logic semiconductors.
In the future, if autonomous driving and electric vehicles become popular, the demand for more advanced semiconductor products centered on logic semiconductors will expand. Because the control of high image processing and artificial intelligence (AI) requires cutting-edge semiconductors. Japan Ministry of Economy, Trade and Industry predicts that with this technological advancement, the market for cutting-edge semiconductors for automobiles will expand to 1.39 trillion yen by 2030, three times that of 2019. The thinner the circuit line width of the
semiconductor, the higher the integration. Large pure electric vehicle manufacturer, Tesla , has launched semiconductors with a circuit line width of 14 nanometers for autonomous driving, and plans to be equipped with finer semiconductors. However, existing Japanese manufacturers are concerned about the heavy factory investment burden and can only reach the 40-nanometer level at present. The cutting-edge products can only be entrusted to TSMC for OEM, and the production is concentrated on TSMC.
companies are still vigilant about semiconductor production
On the other hand, Toyota and Denso are both vigilant about cutting-edge semiconductor production to TSMC. The main reason for the reduction in automobile production after 2021 is the shortage of GM's in-vehicle semiconductors. In TSMC's recent sales composition, automotive semiconductors account for only about 4%. Analysts believe that the reason is that automotive semiconductors have lower priority than semiconductors for smartphones and computers. Coupled with the risk of geopolitical , this is possible for cutting-edge products to happen.
In addition to the original 20 nanometers, TSMC Kumamoto factory also considers producing cutting-edge semiconductors of 12 to 16 nanometers. Denso executives said, "It is rare to be able to directly talk to TSMC in terms of procurement and use of semiconductors about 10 nanometers." It is precisely because of the relationship whether Japan can stabilize its procurement of cutting-edge semiconductors that the industry has high hopes for joint venture factories. Toyota executives said "It is crucial for Japan to maintain closer ties with TSMC."
But there are also problems. TSMC is a wholly owned factory in the Chinese and American markets, and there has never been a precedent for this joint venture overseas factory. At Kumamoto factory, TSMC has most of the capital, and has received huge subsidies from the Japanese government, accepting small investments from Denso and Sony . There are multiple stakeholders, which is the first case for TSMC. It is still unknown whether it can operate together smoothly.
Some relevant personnel also believe that "TSMC, as a semiconductor supplier, cannot ignore Japanese companies. This will play a role in TSMC to a certain extent." Denso is leading the field of autonomous driving and electric vehicles, and this trend will be stronger if it can lead the creation of cutting-edge semiconductor demand. Whether Japanese companies can lead the world in automotive evolution in the CASE era will determine the success or failure of cooperation with TSMC.
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