Sony and Taiwan Semiconductor Manufacturing are reportedly in advanced talks to jointly invest 1 trillion yen ($6.4 billion) in a new image sensor factory in Japan, according to people familiar with the matter.

The proposed facility would be built to produce next-generation image sensors for robots and automobiles, with production slated to begin in 2029. The chip division Sony Semiconductor Solutions is collaborating with the Taiwanese chipmaker on the project, which marks a strategic shift for Sony's image sensor business toward a more asset-light model.

As part of this transition, Sony is reallocating resources toward intellectual property in music rights, movies, and video games. Representatives for both companies declined to comment on the matter. Shares of Sony rose as much as 2.2% in early Monday trading, while Taiwan Semiconductor Manufacturing gained 1.7%.