Japan backs Rapidus with ¥631.5B
Japan approved an extra ¥631.5 billion (about $4 billion) in subsidies to accelerate Rapidus’s push into AI chipmaking, bolstering the government’s high‑risk effort to build a domestic semiconductor competitor. The move signals Tokyo is willing to spend heavily to reduce reliance on foreign chip supply for frontier AI hardware. (x.com)
Japan just added ¥631.5 billion to a company that did not exist four years ago, pushing public research support for Rapidus to ¥2.354 trillion as Tokyo tries to build a homegrown maker of the world’s most advanced logic chips. (reuters.com) Rapidus is aiming at two-nanometer chips, which are the tiny logic chips used to run artificial intelligence servers, data centers, and other high-performance systems where speed and power efficiency matter most. The company says it still plans mass production in fiscal 2027. (reuters.com, businesstimes.com.sg) Japan is not starting from zero in chips, but it is starting from behind. The country held about 50% of the global semiconductor market in 1988, and that share is now about 10%, which is why Tokyo has been spending heavily to rebuild capacity at home. (channelnewsasia.com) Rapidus was set up in August 2022 by eight big Japanese companies: Toyota, Sony, SoftBank, Nippon Telegraph and Telephone, Denso, Kioxia, NEC, and MUFG Bank. Those founders put in a combined ¥7.3 billion, which shows how quickly the state became the main source of money. (rapidus.inc) The basic bet is simple: if Taiwan or South Korea stays the only place making frontier chips, Japan stays exposed. Chips are now treated less like ordinary imports and more like fuel, steel, or grain in a crisis. (reuters.com, datacenterdynamics.com) Rapidus is trying to close the technology gap by borrowing a shortcut from IBM. In December 2022, IBM and Rapidus announced a partnership to develop advanced logic manufacturing technology in Japan instead of building everything from scratch alone. (ibm.com) The factory at the center of this plan is in Chitose, on Japan’s northern island of Hokkaido, where Rapidus has been building its Innovative Integration for Manufacturing site. The pilot line is already operating there, and the company said in July 2025 that it had successfully run gate-all-around transistors for two-nanometer chips. (rapidus.inc) Tokyo is backing two different chip tracks at once. It is paying Taiwan Semiconductor Manufacturing Company to make mature and mid-advanced chips in Kumamoto, and it is paying Rapidus to chase the frontier at two nanometers. (reuters.com, reuters.com) That split explains the size of the check. Taiwan Semiconductor Manufacturing Company’s second Kumamoto plant won up to ¥732 billion in subsidies in 2024, while Rapidus alone has now been approved for ¥2.354 trillion in research support because catching the leaders is far more expensive than hosting an established one. (reuters.com, reuters.com) The hard part is that subsidies do not guarantee customers. Reports around Rapidus have said the full push to mass production could require around ¥5 trillion, which means Japan is still funding a long-shot company that must prove it can make chips reliably, at scale, and on time. (jijipress.com, trendforce.com) This new ¥631.5 billion says Tokyo is still willing to take that gamble. Japan is no longer just trying to attract foreign chip plants to its soil; it is trying to rebuild a national champion for the artificial intelligence era. (reuters.com, bloomberg.com)
