Sony Group and Taiwan Semiconductor Manufacturing Company (TSMC) are preparing to begin mass production of advanced image sensor chips in Kumamoto in southwestern Japan, supported by an investment of approximately Y1tn ($6.29bn).
Nikkei Asia reported that production could begin as early as 2029.
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The manufacturing project will be carried out through a joint venture, with Sony holding about 60% and TSMC 40%.
In May, the two companies signed a preliminary agreement to jointly develop and manufacture next-generation image sensors.
Since then, they have continued discussions on the details of the partnership.
Sony and TSMC plan to complete their production investment decision and formally create the joint venture before the end of fiscal 2026, which ends in March 2027.
Under the proposal, the venture will establish major research, development and production facilities at an existing Sony Semiconductor Solutions sensor plant in Koshi, Kumamoto.
The companies are also in discussions with Japan’s Ministry of Economy, Trade and Industry regarding possible government financial support.
According to the report, sensors made by the venture are expected to be supplied for Apple’s iPhone camera systems.
Beyond smartphones, the companies are seeking to improve sensor functions to support sharper object recognition for AI systems, with a particular focus on “physical AI”, which is technology used to guide robots and vehicles.
Sony Group president and CEO Hiroki Totoki, quoted in the report, described the tie-up with TSMC as “the first step toward a fab-light model”, referring to the company’s approach of reducing its direct ownership of manufacturing infrastructure.
The Y1tn investment is roughly equal to four years of capital spending by Sony’s semiconductor division and is close to the $8.6bn TSMC committed to its first Kumamoto fabrication plant.
The report said Sony is seeking to reinforce its technological position through the partnership, while TSMC is aiming to deepen its expertise in image sensors and broaden its presence in physical AI.
Kumamoto was chosen in part because of its strong water supply, which is important for chip manufacturing, as well as comparatively affordable renewable electricity from geothermal and solar sources, according to the report.
Both companies have indicated plans for ongoing investment in the prefecture’s semiconductor sector over the medium to long term.
