Japan's Rapidus Secures ¥267.6B for 2nm Chip Production
Japanese semiconductor consortium Rapidus Corporation has secured 267.6 billion yen (approx. $1.8 billion) in a funding round backed by the Japanese government and private companies. The capital is intended to help the company move from R&D to mass production of 2-nanometer logic semiconductors by 2027. This investment is part of a broader national strategy to re-establish Japan's leadership in advanced chip manufacturing.
The government of Japan is the top shareholder in Rapidus, with the ability to increase its voting rights to over 50% if the company encounters financial or operational issues. This is part of a broader national strategy that has seen Japan commit 0.71% of its GDP, or $25.7 billion, over a three-year period to revitalize its semiconductor industry, a sector it dominated in the 1980s with over 50% of the global market. Rapidus is a consortium initially backed by eight major Japanese companies, including Toyota, Sony, and SoftBank. The latest funding round attracted 32 private firms, such as Fujitsu, Canon, and Honda, demonstrating a significant expansion of private sector support for the national chip initiative. This broad backing is aimed at re-establishing Japan's prowess in a critical technology area. The technological foundation for Rapidus's 2nm ambition comes from a crucial partnership with IBM, which provides the core process technology. To facilitate this knowledge transfer, over 100 Rapidus engineers have been sent to IBM's R&D center in Albany, New York. The collaboration extends beyond manufacturing processes to include advanced chiplet and packaging technologies. Manufacturing will take place at the new "Innovative Integration for Manufacturing" (IIM-1) facility in Chitose, Hokkaido. This plant has begun installing ASML's state-of-the-art Twinscan NXE:3800E extreme ultraviolet (EUV) lithography systems, essential for 2nm production. ASML is also establishing a nearby service center to support the operations. Rapidus plans to start pilot production in April 2025 and aims for mass production in 2027. The company is targeting an initial output of 6,000 wafers per month, scaling to 25,000 within the first year. While this is behind competitors like TSMC and Samsung, who are targeting 2nm production in 2025, Rapidus aims to compete by offering faster turnaround times through a fully automated and integrated front-end and back-end facility. The project is not without significant financial requirements, with an estimated need for JPY 5 trillion for the start of mass production. To secure this, Japan's three largest banks—Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho—are preparing to provide up to JPY 2 trillion (approx. $12.8 billion) in financing, largely backed by government debt guarantees. This substantial financial commitment underscores the project's national importance.
