NHK Spring Co., Ltd. has decided to build new facility to increase the production capacity of its semiconductor process parts. The company earlier announced it will earmark ¥400 million (US$3.5 million) for the said endeavor.

Amid the increasing demands, the company decided to increase the planned investment and will pour in additional ¥900 million (US$8 million). The target factory is at Miyada plant, the company’s Industrial Machinery and Equipment Division located in Japan’s Nagano prefecture. Construction has already started with planned operation to start in October 2022.

Rapid Increase in Demand

The company manufactures semiconductor process parts at two locations, the Isehara Plant in Kanagawa and in Miyada Plant. The demand for semiconductor process parts of the company, used in semiconductor manufacturing equipment, is rapidly increasing due to the global shortage of semiconductor supply.

For this reason, the company has announced that it will invest ¥400 million in the Miyada Plant to reinforce production capacity for semiconductor manufacturing equipment in response to the latest increase in orders. Since then, the demand for the company’s semiconductor process parts used in semiconductor manufacturing equipment has been increasing. Therefore, the company has decided to invest additional ¥900 million in capital investment.

Improve Profitability

The company will continue to meet the increasing demand for semiconductor process parts, which the company sees growing significantly in the future. The company is considering further increase of the production capacity on the scale of billions, including the expansion of buildings at the Miyada Plant.

In the “2023 Medium-Term Management Plan,” currently being promoted, the company plans to invest the total of ¥88 billion (US$775 million), about ¥53.6 billion in Japan and  ¥34.3 billion overseas, for three years till the end of fiscal year ending March 2024.

One of the priority issues for the 2023 Medium-Term Management Plan is to steadily respond to the favorable semiconductor market conditions and to improve profitability in the semiconductor process parts business.