Mitsubishi Electric held a completion ceremony on October 1, 2025, for its new power semiconductor factory in Kumamoto Prefecture, Japan. The facility will produce silicon carbide (SiC) power semiconductors, primarily targeting the electric vehicle (EV) market. However, the company has delayed expected growth targets amid slower-than-anticipated EV demand, with capacity expansion now set to proceed gradually based on market conditions.
The newly constructed plant, located at the Shisui Factory in Kikuchi City, involved an investment of about JPY100 billion (US$675.71 million), according to reports from Nikkei Asia and Kyodo News. This facility incorporates an advanced 8-inch wafer production line, replacing the existing 6-inch wafer lines previously employed at Mitsubishi Electric's Koshi City factory. The upgrade brings fully automated wafer handling from input to shipment and is estimated to boost production efficiency by approximately 30%. A product development line is scheduled to begin operating in November 2025, but any further capacity increases will depend on demand trends in the EV and related semiconductor markets.
Adjusting production plans amid shifting market conditions
At the completion ceremony, Mitsubishi Electric president Kei Uruma acknowledged the rapidly evolving nature of customer demand for EV power semiconductors and indicated that adjustments to equipment and production setups were necessary. This suggests a postponement of initial expansion schedules tied to aggressive growth assumptions. Mitsubishi Electric Power Device Manufacturer—the company's power device subsidiary overseeing both Shisui and Koshi factories—said that while the goal of increasing SiC power semiconductor revenue share beyond 30% remains, the timeline is now expected to be extended.
Mitsubishi Electric's Semiconductor and Devices Division noted that the company does not plan to rely solely on EV market growth to drive the factory's operations. Instead, efforts will focus on raising customer awareness of product functionality, including among plug-in hybrid electric vehicle (PHEV) users, to diversify demand sources. This approach reflects Mitsubishi Electric's strategic shift toward broader application of SiC semiconductors beyond purely battery electric vehicles.
Strategic pivot toward optical semiconductors
In March 2023, Mitsubishi Electric had announced plans to expand investment in power semiconductor production to about JPY260 billion by fiscal year 2025, doubling previous capital expenditure. However, by May 2025, the company reversed this decision, scaling back semiconductor investments and reallocating some funds to the fiber optics sector, which has shown robust performance. This pivot includes increased investment in optical semiconductor devices integral to data center fiber optic transmission.
Mitsubishi Electric also reiterated its long-standing advocacy for industry consolidation within Japan's power semiconductor segment. Uruma pointed to the small scale and fragmentation of domestic manufacturers as vulnerabilities when competing with larger Chinese firms. He voiced ongoing support for restructuring efforts aimed at creating stronger industry players capable of competing globally amid intensifying market pressures.
Article translated by Jingyue Hsiao and edited by Jerry Chen
