Mitsubishi Acquires Plant from Sharp, Boosting EV Power Chip Production
The acquisition of a wafer manufacturing factory in Fukuyama, Japan, will allow Mitsubishi Electric to expand its power device business segment.
Mitsubishi Electric recently announced the acquisition of a 46,500-square-meter wafer manufacturing site from Sharp Fukuyama Semiconductor Co. Ltd., a subsidiary of Japanese electronics giant Sharp Corporation. The plant, based in Fukuyama, Hiroshima Prefecture in Japan, is slated to open in November 2021. The deal was valued at around 20 billion yen, which converts to approximately $186 million USD.
Image courtesy of Mitsubishi Electric.
In the announcement, Mitsubishi stated that the acquisition of the three-story building was in response to increased demand for efficient power management technology in the automotive market, in line with the global push towards carbon-reduction and energy conservation measures.
At the new facility, Mitsubishi Electric's Power Device Works unit will process wafers for the production of power semiconductors—adding fuel to the company’s already-growing power device business segment, which produces SiC and IGBT modules, optical devices, high-frequency devices, and TFT LCD modules.
Mitsubishi Electric’s main business segments are electronic devices, home appliances, information and communication, industrial automation, and energy and electric systems. The power electronic device segment only accounts for 4.1% of the company’s revenue, according to its financial reports. Comparatively, products in the industrial automation and energy/electric systems categories bring in the most revenue, at 26.6% and 25.8% respectively, followed by home appliances at 21.5% and information and communications systems at 9%.
Still, orders and revenue in the electronic device segment have increased by 4% to 208.7 billion yen in the past year, according to the company’s 2020 fiscal year earnings results. The growth is attributed to the rising demand for high frequency and optical devices used to power 5G communications networks, large data centers, and electric vehicles. Partially to the increase in revenue, the company reported an operating profit of 8.7 billion yen, a significant jump from 1.4 billion yen last year.
Planning more growth in the segment, the new wafer plant in Fukuyama will allow Mitsubishi Electric to increase its semiconductor production capacity to meet further demand for products such as electric vehicles and energy-efficiency devices—both markets that the company targets in its long-term growth strategy.
In a document outlining its business development plan through 2025, the company stated that the goal of its power device business is to “provide key devices for energy-savings based on the most advanced power semiconductor technology.”
This objective includes supplying power reduction devices to address low-carbon efforts, improving the value of the company’s compact and lightweight devices, and supplying devices to address global energy conservation and electric vehicle adoption.