Monday, May 15th 2023
Samsung Said to Open Chip Development Unit in Japan
In a rather unexpected move, Samsung will reportedly open a chip development facility in Yokohama, Japan. According to the Nikkei, Samsung is readying a 30 billion yen or US$222 million investment near its current R&D institute in Japan. Samsung is hoping to be able to leverage a combination of Japanese and Korean expertise at the site, although exactly what kind of chip development that will take place at the site is currently unknown, beyond it being focused on the back-end processor of chip manufacturing. This generally involves the wafer packaging process or chip stacking, processes that have evolved a lot of the past few years.
The facility is said to be employing hundreds of people once it starts operating sometime in 2025. The Nikkei is also reporting that Samsung is hoping to take advantage of subsidies offered by the Japanese government, which might also be one of the reasons for opening the development unit in Japan. The subsidies are said to be in excess of 10 billion yen. Considering that Japan and Korea aren't on the best terms at the moment, for many reasons and most of them irrelevant to this news post, it's surprising to see Samsung making this move, as although it might be a fairly minor investment for the company, it's doing so on what could only be referred to as hostile soil.
Source:
The Nikkei
The facility is said to be employing hundreds of people once it starts operating sometime in 2025. The Nikkei is also reporting that Samsung is hoping to take advantage of subsidies offered by the Japanese government, which might also be one of the reasons for opening the development unit in Japan. The subsidies are said to be in excess of 10 billion yen. Considering that Japan and Korea aren't on the best terms at the moment, for many reasons and most of them irrelevant to this news post, it's surprising to see Samsung making this move, as although it might be a fairly minor investment for the company, it's doing so on what could only be referred to as hostile soil.
8 Comments on Samsung Said to Open Chip Development Unit in Japan
Another factor to choose Japan: it being a R&D facility so it makes sense to establish it in a highly educated country.
Oh, how the mighty (Japan) has fallen.
Prime Minister Kishida recently visited South Korea and met with economic officials. Relations are improving.
www.mofa.go.jp/mofaj/a_o/na/kr/page1_001660.html
On the business side, SK is still not a preferential partner after having been dropped, and it'll take a few years before Japan puts them back on the list. For the time being, the export ban is gone and SK will get the much-needed resources critical to chip production again, although at higher cost. For Japan, this is a high-visibility move that could see a revival in their own in-country chip development capabilities, since IIRC, part of their subsidies is that tech companies will need to open a facility in Japan, and hire and train Japanese. Critically for interested players, this could be one way of working out favors for deals on the 3 critical chemicals needed in chip production, since Japan provides around 70-90% of the world's supply. Specifically:Per CNBC on the Export Ban in 2019.
On the political side, this is a plain win for Japan. A big-name tech company is setting up shop (moreso from a legacy rival nation), with others to potentially follow, and South Korea suspended their demands that led to a trade ban in the first place in order to save their own tech companies (which are very influential, unlike Japanese tech companies since the shift from Zaibatsus to Keiretsus). For South Korea though; it's considered a loss. While they did save their tech companies from shrinking production due to a lack of rare chemicals, they had to basically accept the current US/Japanese position on past reparations.