TAIPEI (Taiwan News) — Sony Group confirmed it is mulling a partnership with Taiwan Semiconductor Manufacturing Co (TSMC) to construct a chip fab in Japan.

Sony Chief Financial Officer Totoki Hiroki made the announcement during an earnings call on Thursday (Oct. 28), according to Nikkei. “The stable procurement of semiconductors is a crucial issue amid the chip crunch, and (TSMC’s plant) could be a solution,” Nikkei cited Totoki as saying.

The company is in talks with TSMC and the Japanese government to assist the Taiwanese chipmaker and set up a chip plant in Japan, Totoki said, according to Bloomberg. Sony is TSMC’s biggest Japanese client.

“Our basic stance is we would provide support for TSMC in setting up and operating a new factory in Japan,” the Sony CFO said. “Deepening the relationship with TSMC will have a big benefit for us.”

Sony taps contract manufacturers to produce most of its logic chips, which are a crucial component in its image sensors, per Nikkei. The Japanese company controls about 50% of the global image sensor market for smartphones, Nikkei added.

TSMC announced in early October that it plans to build a chip fab in Japan, with construction slated to start next year and production expected to begin in 2024. The new plant is estimated to cost around US$8.8 billion (NT$245 billion) and will be built in Kumamoto on land close to a Sony chip factory, according to Nikkei.