Rapidus Gearing Up for Mass Production of Next-Generation Chips

Jiji Press

12:42 JST, May 6, 2024

Tokyo (Jiji Press)—Japan’s Rapidus Corp. is stepping up efforts to embark on mass production of next-generation semiconductors in 2027.

The Tokyo-based chipmaker was set up in August 2022 by eight Japanese firms aiming to realize domestic production of state-of-the-art semiconductors.

Reviving the Japanese chip industry, which once led the global market, is crucial for strengthening the country’s economic security, with the Japanese government having decided on providing nearly ¥1 trillion in subsidies to Rapidus.

Still, challenges remain over technology and profitability.

“We are close to launching a prototype production line in April 2025,” Rapidus President Atsuyoshi Koike said on April 2 this year, showing confidence in clearing the first hurdle toward mass production.

Also on April 2, the government decided to provide Rapidus with up to ¥590 billion in additional aid. The state’s financial assistance to the company is thus set to total up to ¥920 billion .

Rapidus aims to mass-produce chips with a circuit line width of 2 nanometers, the most advanced type of semiconductor. Two-nanometer chips, whose demand is expected to increase for use in advanced technologies such as artificial intelligence and autonomous driving, have yet to be mass-produced in the world. A nanometer is one-billionth of a meter.

A chip with a finer circuit line width offers a better performance. Currently, Japanese chipmakers are able to produce 40-nanometer general-purpose chips, used in products such as automobiles and consumer electronics, at best.

Rapidus plans to spend the additional state subsidies on its factory in the city of Chitose, Hokkaido, northernmost Japan, which is now under construction, and the introduction of manufacturing equipment, as well as on developing technology for the final processing phase of chip production.

In many cases, work in the front process, the main part of chip production, is separated from the final processing phase. By integrating both processes, Rapidus hopes to shorten the lead time for delivery, with an aim to overtake foreign rivals running ahead.

The company also plans to send 100 more engineers to IBM Corp. of the United States, which has technology to manufacture 2-nanometer chips, within this year to promote work to develop technology needed for the front process.

Rapidus has set up a marketing foothold in Silicon Valley in California, which hosts a number of information technology companies, in order to develop sales channels.

About 300 Rapidus engineers are slated to move to Chitose by the time the prototype line at the factory in the Hokkaido city starts operating in April 2025.

Factors including a rise of foreign semiconductor makers and a 1986 Japan-U.S. semiconductor accord, which was intended to lower Japan’s share of the global chip market, have led to the Asian country losing many related personnel and know-how.

Waseda University graduate school professor Atsushi Osanai showed concern about Rapidus planning to start with the production of state-of-the-art 2-nanometer-chips.

“It may be difficult (for Rapidus) to achieve a cost advantage unless (the company) surpasses global rivals, such as Taiwan Semiconductor Manufacturing Co., in terms of large-scale production,” Osanai said.

Rapidus is expected to need a total of about ¥5 trillion for mass production of 2-nanometer chips.

The eight investors in Rapidus—Kioxia Corp., Sony Group Corp., SoftBank Corp., Denso Corp., Toyota Motor Corp., NEC Corp., Nippon Telegraph and Telephone Corp., and MUFG Bank—have injected a total of ¥7.3 billion into the company.

But there have been no proposals for making additional investments in the company.

With about three years to go before the planned start of mass production, Rapidus faces a host of difficult challenges.