iPhone XS Parts Demand Prompts Murata To Invest In New Plant

Japanese electronic components maker Murata Manufacturing is setting up a new facility in its home country because the new iPhones are driving up demand for its products. The company is hoping that the new plant could boost its capacity by 20 percent next year.

Nikkei reported Tuesday that Murata is building a new ceramic capacity plant and revamping its existing operations in Japan and the Philippines in order for it to meet the growing demand for parts used by Apple in its new iPhones and those used by other companies in electric vehicles.

Murata reportedly ships 1 trillion ceramic capacitors yearly. The capacitors are essential components of most electronics for cutting circuit noise. Demand for these capacitors has significantly increased recently because Apple has just launched its new iPhones.

A single smartphone typically utilizes up to 1,000 capacitors. Aside from iPhones, Murata’s capacitors are also used in the production of electric vehicles. Each car roughly uses 10,000 units of the ceramic capacitors. Given the demand for Apple’s iOS 12-powered handsets and the growing demand for electric vehicles, it’s not surprising why Murata is eager to produce more capacitors.

Murata is spending 40 billion yen or US$354 million for a new facility near its headquarters in Shimane Prefecture in southwestern Japan. Construction of the plant is scheduled to commence next month and the company is hoping for it to be completed in 2019. Murata did not disclose the specific time frame for the completion of the project.

The Japanese company is already controlling 40 percent of the world market. By building the new facility and revamping its operations, Murata could increase its capacity by 20 percent by 2019. The boost is very timely considering the expected rollout of 5G mobile networks and more electronic vehicles that’s bound to increase the overall demand for electronic components next year.