Toshiba Plans To Double Its Chip Production With An Investment Of $1 Billion

The global chip shortage has taken a toll on production, crippling some firms and slowing down production for a handful of others. While no one knows when the chip shortage problem is expected to last, some tech executives and enthusiasts have shared their opinions on when they think the chip shortage would last. For instance, last year, the Chief Executive Officer of networking giant company Cisco Systems, told BBC in an interview that the global chip shortage should last for about six months and get better twelve to eighteen months after that. He also stressed that the continued expansion in technologies such as 5G, the Internet of Things (IoT), Cloud Computing and Artificial Intelligence, will continue to push the demand for semiconductor chips higher.

The founder of Dell Technologies; Michael Dell, also mentioned last year that the ongoing shortage in chips needed for electronic devices may persist for the next few years.

As a way of accelerating production and battling the challenges created by the problem of chip shortage, chipmakers and companies have been increasing their investment in the sector and ramping up production to meet the huge demand for chips.

On Friday, Toshiba Corp announced plans to invest 125 billion yen, the equivalent of $1.09 billion, to at least double its production of power management semiconductors. The company also aims to become a market leader in the chip production category, catching up to giants such as Infineon Technologies.

Here’s what Toshiba’s plan entails. The company wants to build a 300-millimetre fabrication plant in central Japan for power management chips. These chips will be designed to efficiently control electric power in cars, electronic devices and industrial equipment.

Apart from the fabrication plant in central Japan which 100 billion yen will be spent building, the company will use 25 billion yen to invest in a 300-millimetre fabrication line it is building at an existing chip plant, according to a spokesperson.

The spokesperson also added that the new plant will begin its operations by March 25^th and that when the first phase is complete, the company’s power chip output capacity would be at least 2.5 times what it is producing now.

The company, depending on demand, could make an additional investment aimed at expanding, in the new plant.