Wed, Jun 20, 2012 - Page 14 News List

Renesas to boost market share with TSMC cooperation

Bloomberg

Renesas Electronics Corp, the world’s largest maker of microcontrollers used in cars, said its partnership with Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) would help the company boost market share and operating margin.

The Japanese supplier to companies including Toyota Motor Corp aims to raise its share of the microcontroller market to 35 percent in five years from 27 percent last year, targeting customers in emerging countries, said Shinichi Iwamoto, a senior vice president heading the unit. The alliance with TSMC would help reduce fixed costs and increase the profit margin, Iwamoto said in an interview in Tokyo yesterday.

The alliance with TSMC may also help raise the ratio of products made for it by other companies to about 30 percent in 2016 from 15 percent last fiscal year, Iwamoto said.

TSMC, the world’s largest custom chipmaker, will start to ship 40-nanometer chips to Renesas for the devices used in cars, including devices to trigger airbags, the two companies said on May 28.

“TSMC has flexible production capacity and technology, which will broaden our business,” Iwamoto said.

The two companies will also consider cooperating in developing smaller and more energy-efficient 28-nanometer chips, he said.

“We expect to get more orders from Renesas in the future because of our collaboration on 40 nanometer and beyond,” TSMC spokeswoman Elizabeth Sun (孫又文) said.

Renesas has decided not to build facilities for advanced manufacturing, so it makes sense for its chips at newer technologies to be made at TSMC given the cooperation, she said.

Renesas’ customers include Sharp Corp, Sony Corp and Panasonic Corp. The company’s microcontroller business has operating profit margin of at least 10 percent, said Ryuji Omura, the unit’s general manager.

Between 60 percent and 70 percent of chips used by Toyota and Nissan Motor Co are made by Renesas, according to Kunihiko Onuma, head of Hitachi Ltd’s automotive systems unit. Hitachi owns 30.6 percent of Renesas, according to data compiled by Bloomberg.

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