Japan offers "half-price factory construction + full subsidies," but Samsung and SK Hynix remain cautious about investing in Japan.

The Japanese government has offered highly attractive investment conditions to Korea's storage chip giants, but Samsung Electronics and SK Hynix have failed to make substantive investment decisions for years.

On February 24, according to Trend Force, despite the fact that building a factory in Japan may cost only half as much as in Korea and would receive comprehensive policy support, Samsung Electronics and SK Hynix remain cautious due to domestic public opinion pressure and constraints from stakeholders.

SK Hynix recently officially denied reports by Nikkei News that it planned to invest 2 trillion yen in building a memory chip factory in Japan. According to Chosun Biz, Samsung and SK Hynix have received numerous invitations from the Japanese government to build factories over the past several years, but the proposals have always been put on hold.

Reports say this cautious attitude stands in stark contrast to the rapid expansion of chip manufacturers such as TSMC and Micron in Japan. The Japanese government has provided up to 476 billion yen in subsidies to TSMC’s Kumamoto plant and has offered up to 500 billion yen in support for Micron’s Hiroshima HBM chip plant, highlighting its determination to revitalize the semiconductor industry.

Analysts believe that the hesitance of Korean companies may affect their competitive position in the restructuring of the global semiconductor supply chain, particularly in key areas such as high-bandwidth memory where competitors are accelerating capacity deployment through their bases in Japan.

Cost Advantages Clouded by Political Concerns

According to Chosun Biz citing Samsung Electronics semiconductor division executives, the initial investment and total ownership cost of building and operating a memory chip factory in Japan may be only about half that of in Korea.

The Japanese government provides a "full support package," including tax breaks, infrastructure assistance, labor support, and connections with local equipment suppliers. In contrast, domestic factories in Korea have almost no substantive incentive measures and often incur additional costs.

However, Chosun Biz pointed out the main reason Samsung and SK Hynix have delayed building factories in Japan is domestic public opinion and pressure from the government and local stakeholders.

Although from the perspective of cost and long-term growth, the factory in Japan may be the safest choice, these external constraints appear to outweigh the financial advantages.

According to SeDaily and Chosun Biz, executives of both companies in the past years have only conducted preliminary cost estimates for building semiconductor factories in Japan, but discussions have never moved forward to actual investment decisions or production line planning.

International Competitors Accelerate Expansion in Japan

The report says, in contrast to the cautious attitude of Korea's storage chip giants, TSMC and Micron are rapidly expanding in Japan.

According to Chosun Biz, Japan's Ministry of Economy, Trade and Industry provided up to 476 billion yen in subsidies to TSMC’s Japanese subsidiary JASM for its Kumamoto plant, and subsequently added support for the second phase of investment.

According to Yomiuri Shimbun, TSMC has finalized plans to mass produce Japan's first batch of 3-nanometer chips in Kumamoto, with a total investment expected to reach $17 billion (about 2.6 trillion yen).

Memory chip manufacturer Micron is also strengthening its deployment in Japan. According to Nikkei News and Reuters in late 2025, Micron will invest 1.5 trillion yen ($9.6 billion) to build a new HBM chip factory in Hiroshima.

Construction will begin in May at its existing site, and shipments are expected to start around 2028. Japan's Ministry of Economy, Trade and Industry will provide up to 500 billion yen in support for the project.

Chosun Biz pointed out that the Japanese government also continuously supports the production bases operated jointly by Western Digital and Kioxia.

In 2024, Western Digital announced that capital investment in 8th and 9th-generation 3D flash memory at its Kioxia Yokkaichi (Mie Prefecture) and Kitakami (Iwate Prefecture) plants was certified by Japan's Ministry of Economy, Trade and Industry, meeting the criteria for investment subsidies.

According to official press releases, the total support received by the two factories includes up to 150 billion yen, and another 92.9 billion yen is provided based on the specific semiconductor production facility development plan approved in July 2022.

Risk Warning and DisclaimerThe market has risks, investments require caution. This article does not constitute personal investment advice, nor does it take into account the particular investment objectives, financial circumstances or needs of individual users. Users should consider whether any opinions, views or conclusions in this article suit their specific circumstances. If you invest based on this, you are responsible for the outcome.