The Japanese government has finalized plans to inject ¥100 billion (about $635 million) into domestic chipmaker Rapidus Corp. under its fiscal 2025 budget, aiming to bolster the company's next-generation semiconductor production capabilities. According to officials, the investment, slated for the second half of 2025, is part of a broader strategy to strengthen Japan's semiconductor industry and catalyze private-sector funding.

Rapidus plans to raise an additional ¥100 billion from existing and new shareholders, matching the government's contribution. The funds will be used to acquire essential production equipment, including Extreme Ultraviolet (EUV) lithography machines, vital for producing advanced 2-nanometer (nm) chips.

Rapidus' Vision for Semiconductor Leadership

Founded in 2022 with backing from major Japanese corporations such as Toyota, Sony, NTT, NEC, and SoftBank, Rapidus aims to achieve mass production of 2nm chips by 2027. The company's facility in Chitose, Hokkaido, is on track to begin trial production in April 2025, with a fully automated production line incorporating robotics and artificial intelligence. This approach is expected to reduce delivery times to one-third of competitors' timelines, offering enhanced performance and efficiency.

Rapidus CEO Atsuyoshi Koike emphasized the competitive edge of the automated factory, which streamlines traditionally labor-intensive processes like interconnection, packaging, and testing. The company's first EUV lithography machine arrived in December, marking a key milestone in its development timeline.

Addressing Funding Challenges

Despite the Japanese government pledging financial support totaling ¥920 billion, including the latest investment, Rapidus estimates that achieving its 2027 production target will require approximately ¥5 trillion. This leaves a significant funding gap of around ¥4 trillion. The government hopes its contribution will stimulate further private investment to close this gap.

Economic Revitalization Minister Ryosei Akazawa reaffirmed the government's commitment during a visit to Rapidus' construction site, stating that the initiative is pivotal for advancing Japan's semiconductor manufacturing capabilities.

With the completion of the external structure of its 2nm fab expected in October 2025, Rapidus is positioned to become a significant player in the global semiconductor market, leveraging cutting-edge automation to outpace its competitors.