Sony Group and Taiwan Semiconductor Manufacturing Co. (TSMC) plan to begin mass production of next-generation image sensor semiconductors in Kumamoto prefecture in southwestern Japan as early as 2029, with total investment expected to reach around 1 trillion yen ($6.3 billion).
Production will be carried out by a new joint venture expected to be about 60% owned by Sony and about 40% by TSMC. The companies reached a basic agreement in May to cooperate on the development and production of next-generation image sensors, although specific details of the partnership have remained under discussion.
Sony and TSMC are expected to reach an agreement on the mass production investment in the near future and establish the joint venture by the end of fiscal 2026, which runs through March 2027. The planned venture represents a significant expansion of cooperation between the Japanese image sensor specialist and the world’s leading advanced semiconductor manufacturer.
The joint venture is expected to supply high-performance camera sensors for Apple’s iPhone. Beyond smartphone applications, the companies aim to improve sensor performance so that artificial intelligence systems can recognise objects with greater precision. Their longer-term target includes the emerging field of “physical AI”, in which AI systems control robots and vehicles.
The venture plans to install large-scale research and development facilities and production lines at an image sensor plant operated by Sony Semiconductor Solutions in the city of Koshi in Kumamoto. Sony and TSMC are also in talks with Japan’s Ministry of Economy, Trade and Industry about potential government subsidies.
The scale of the proposed investment would be substantial for Sony’s semiconductor operations. The planned 1 trillion yen would be equivalent to roughly four years’ worth of capital expenditure by Sony Group’s semiconductor business. It would also approach the $8.6 billion total investment in TSMC’s first Kumamoto fab.
Kumamoto’s industrial advantages are also central to the companies’ plans. The Koshi plant is located about 30 kilometres from the epicentre of the earthquake that struck Kumamoto in July, but suffered no major damage. The prefecture offers abundant water resources essential for semiconductor manufacturing, as well as relatively easy access to low-cost electricity generated from renewable sources such as geothermal and solar power. Sony and TSMC have indicated that they intend to continue investing in semiconductor production in the prefecture over the medium to long term.
Sony holds more than half of the global market for CMOS image sensors, but competitors including China’s OmniVision and South Korea’s Samsung Electronics are seeking to narrow the gap through aggressive investment. By partnering with TSMC, which leads the world in advanced semiconductor manufacturing, Sony hopes to widen its technological lead.
The partnership will nevertheless preserve important technological boundaries between the companies. Sony is not expected to disclose to TSMC certain proprietary manufacturing technologies that underpin its strength in image sensors. TSMC, meanwhile, aims to deepen its expertise in the segment through closer cooperation with the market leader, while strengthening its capabilities in the emerging physical AI field.
Sony declined to comment on the matter. TSMC said there is no new information to add to the May announcement of the partnership with Sony.
