Nikkei newspaper stated that Micron Technology will invest 1.5 trillion yen ($9.6 billion) in western Japan to construct a plant to produce memory chips to be used in artificial intelligence applications.
The drive comes after Micron seeking to diversify more than Taiwan in the advanced chip manufacturing, Nikkei said, citing the people familiar with the matter.
According to the report, the new factory will produce high-bandwidth memory (HBM) chips, which are an important component to operate AI processors like those produced by Nvidia.
Nikkei reported that Micron plans to construct the facility within the compound of its Hiroshima plant, which will commence in May, and is expected to start the shipments of HBM around 2028.
The newspaper reported that the Ministry of Economy, Trade, and Industry will subsidize the costs of the project as low as 500 billion yen.
To restore the chipmaking capabilities of the Japanese nation, a 5.7 trillion-yen plan that has already been allocated has been implemented by Japan in 2021.
However, an additional budget of 252.5 billion yen is bound to be obtained by the country to contribute further to the development of AI and semiconductors.
The budget that was passed by the cabinet led by Japan’s Prime Minister, Sanae Takaichi, is heading to parliament for votes.
The Micron Hiroshima factory has received 774.5 billion yen from the government; similarly, other companies also offered funds, such as global foundry giant Taiwan Semiconductor Manufacturing Co. and homegrown Rapidus.
Meanwhile, Micron is competing in HBM with South Korea’s SK Hynix and Samsung Electronics. Emerging demand for chips has come in through tech companies such as OpenAI and Meta Platforms as they aim to train and run AI services.
