Battle for supremacy in East Asia semiconductor manufacturing

From Taiwan to Kumamoto prefecture in Japan, the South Korean city of Pyeongtaek, and the US state of Arizona – a global rush to build new semiconductor manufacturing capacity is underway.

The battle for supremacy in semiconductor manufacturing in East Asia has always been brutal.

From Taiwan to Kumamoto prefecture in Japan, the South Korean city of Pyeongtaek, and Arizona in the United States – a global rush to build new semiconductor manufacturing capacity is underway.

They also form what is known as the so-called “Chip 4” alliance, seen as an attempt to encircle China’s chip ambitions.

However, even within the US-led small yard and high fence, the battle is fierce. 

JAPAN, ONCE A DOMINANT FORCE

Japan once reigned supreme in global semiconductor manufacturing.

In the 1980s, ultra-efficient Japanese producers controlled up to 70 per cent of the global DRAM memory chip market at one point, pushing their American competitors to the brink of collapse.

But the absolute dominance soon bred hubris and overinvestment.

In the 1990s, when memory prices crashed amid an economic downturn, Japanese DRAM producers crumbled.

When Japanese memory maker Elpida filed for bankruptcy in 2012, the country officially bowed out of the industry it once dominated.