Japanese firm Murata to manufacture key electronic components in Thailand
Murata, a supplier of components to Apple, has invested 2.4 billion baht to create a new production base in Thailand for multilayer ceramic capacitors (MLCC), which it believes will create over 2,000 jobs.
Murata Electronics Thailand Co Ltd, a key electronic components supplier of Apple, said last week that the new manufacturing facility at the World Industrial Estate Co Ltd in Lamphun province would open on November 25.
This new factory will manufacture MLCC, which are flagship products for Murata. These components enhance the stability of various mobile devices such as smartphones, computer servers, data sensors, automobiles, and satellites. These MLCCs have a significant global market share of up to 40%.
The geopolitical tensions between the United States and China have affected the electronics industry, leading to what is often referred to as the “tech war”. Murata, among other foreign companies, has decided to relocate its production base from China to mitigate business risks.
Once the construction of this new manufacturing facility is completed, Murata aims to strengthen its MLCC production bases in four countries: Wuxi in China, Singapore, Thailand, and two locations in Japan (Fukui and Izumo). This expansion would not only contribute to Murata's global supply chain, but also mark a significant milestone in the electronics industry of Thailand, the company said.
Murata plans to expand its production capacity by 10% annually. Over the past decade, Murata has already increased its production of MLCC by over three fold. This expansion aims to meet the growing demand for MLCC components driven by the adoption of 5G technology, internet of things devices, and other electronics such as smartwatches, computers, servers, and automotive electronics, especially in high-end smartphones where these capacitors can reach up to 1,000-1,200 units per device, the company said.
With the rising trend of electric vehicles (EV), which might require up to 10,000 capacitors per vehicle, Murata, which currently has a more than 50% market share for MLCCs in EVs, is poised to meet this demand.
Due to political pressures and the ongoing tech war between the US and China, many foreign companies are diversifying their manufacturing bases, with a significant interest in investing in Asean countries. Japan, in particular, has increased its investments in Thailand substantially over the past 30 years.
Murata Electronics Thailand will construct a new manufacturing facility in the World Industrial Estate Co Ltd in Lamphun province. This new facility, valued at over 2.4 billion baht, will cover an area of 64 hectares and is set to begin production this November. Initially, the factory will have a production capacity of 2 million units per month, aiming to scale up to 30 billion units per month by 2028. This expansion plan will create an additional 2,000 jobs in the region, the company said.
Hirokatsu Sasahara, managing director of Murata Electronics (Thailand) Co Ltd, noted that Murata was the first Japanese company to invest in Lamphun province 35 years ago. With continuous investments, it has become a leader in the local industry. The company's investments between 2020 and 2022 amounted to 6.93 billion baht, accounting for 10% of the total investments in Northern Thailand and 40% of the investments in Lamphun province. Murata has also been collaborating with local educational institutions to promote development of skilled labour in the region.
The investment marks Murata's strategic partnership with Thailand and Japan, emphasising co-creation for future industrial investments.
As part of this initiative, Murata is encouraging potential Japanese investors to expand their investments in Thailand, supporting the development of manufacturing capabilities in line with Murata's decision to expand its technologically advanced production in the country, according to Junichiro Kuroda, president of Japan External Trade Organisation Bangkok office.
The Thai government's consideration of a comprehensive approach involving both domestic private entities and foreign investors is crucial in maintaining Thailand's competitiveness in the region, Junichiro said. It is hoped that the new government would focus on enhancing infrastructure, continuous innovation, and fostering a highly skilled workforce to attract future investments in various emerging industries, including medical technology, agriculture, and startups, Junichiro added.
