Japan chipmaker Rapidus mulls building factory in Hokkaido

State-backed chipmaker Rapidus Corp. said Thursday it is considering building a factory on the northern main island of Hokkaido, as the new company aims to revive Japan's semiconductor industry through homemade next-generation chip production.

Hokkaido is one of a number of locations that are eager to host the factory and Rapidus plans to make a decision by the end of March.

Gov. Naomichi Suzuki pitched Hokkaido as an ideal site during a meeting with Rapidus President Atsuyoshi Koike at the company's Tokyo headquarters, citing ample water supply, important for chip-making, as well as fine educational institutions.

Hokkaido Gov. Naomichi Suzuki (L) meets with Rapidus Corp. President Atsuyoshi Koike in Tokyo on Feb. 16, 2023. (Kyodo)

"We hope you consider setting up a hub for production, personnel training and research, and add a headquarters function," Suzuki said.

Koike was quoted as saying that Rapidus wants to make the planned factory in Japan "the world's best."

Created by Toyota Motor Corp., Sony Group Corp. and six other major Japanese companies with a total investment of 7.3 billion yen ($55 million), Rapidus plans to mass-produce chips with state-of-the-art 2-nanometer technology in Japan in 2027.

Such advanced chips can be used for 5G communications, quantum computing, data centers, self-driving vehicles and digital smart cities.

The chip-manufacturing company is also set to receive state subsidies of 70 billion yen as part of the Japanese government's semiconductor strategy.

Rapidus has recently partnered with U.S. tech giant IBM Corp. to manufacture advanced semiconductors.