Under the strong demand for automotive chips, DENSO, a major Japanese auto parts manufacturer, is considering spinning off its chip business, as TSMC (2330-TW)(TSM-US) as its wafer foundry, DENSO is also one of the shareholders of TSMC’s Japanese subsidiary JASM, and the two parties have a close cooperation relationship. As DENSO considers splitting the wafer business and expanding the layout of automotive wafers, the amount of wafer input to TSMC is also expected to increase.
DENSO Chief Technology Officer Yoshifumi Kato revealed in an interview that DENSO has to think regarding whether it is time to sell chips independently. There are also no current plans to raise funds through spin-offs.
Semiconductors are playing an increasingly important role in the automotive industry as more and more key components are used in fuel vehicles, electric vehicles and self-driving technologies. DENSO predicts that in 2025, automotive chip demand will be one-third higher than in 2020.
DENSO is currently the fifth largest automotive chip factory in the world, and has invested regarding 160 billion in the chip business in the past three yearsJapanese Yenand actively strive for the throne of the world’s leading automotive chip manufacturers.
In order to meet the demand for long-term stable supply of automotive chips, DENSO invested 350 million US dollars in JASM, a subsidiary of TSMC Japan Kumamoto, and obtained more than 10% of the equity. 45,000 pieces increased to 55,000 pieces.
