KUALA LUMPUR: Japan’s Denso Corporation is investing RM160mil to expand the production capacity of its automotive semiconductors in Malaysia.

The Malaysian Investment Development Authority (MIDA) said in a statement on Wednesday the investment, via its subsidiary Denso Malaysia Sdn Bhd, has been approved and it scheduled to start in April.

It will be venturing into the production of automotive semiconductors, ASIC named “exposed package (Ex-PKG)”, which is superior and competitive in terms of high functionality, efficient high heat dissipation, miniaturisation and cost reduction.

MIDA said this project was also in line with the government's National Automotive Policy (NAP) 2020 to develop critical components within next-generation vehicles, mobility technology and autonomous driving.

“The investment will establish fully automated machine production lines with Denso-designed manufacturing equipment and unique processing techniques that emphasise on high efficiency and high quality, ” it said.

MIDA said the introduction of fully automated production lines will accelerate the moving toward Industry 4.0 technologies, such as IoT deployment, big data management and factory automation in Malaysia.

Denso’s products range from air-conditioning systems, radiators, engine control units, airbag electronic control units, electric power steering and other products.

In recent years, electronic controls have been increasingly adopted in various vehicle systems. The semiconductors’ performance evolves continuously to enhance the safety standards of growing demands for semiconductors to full autonomous electric vehicles.

MIDA chief executive officer Datuk Azman Mahmud (pic, below) said: “We are honoured to be selected as the country outside Japan to produce the advanced products as a result of continuous research and development (R&D).

“Moreover, we acknowledge the operational expenditure of over RM20mil in the next five years would benefit the local business ecosystem, from insurance, legal, banking, information and communication technologies (ICT) as well as transportation industries.”

Azman said Denso’s decision to expand their presence in Malaysia has proven the country continues to be a competitive investment location for high-value operations amidst global headwinds.

He described Denso’s investment as another testament to MIDA’s efforts in attracting quality investment into Malaysia.

Denso has more than 40 years of experience in manufacturing in-vehicle semiconductors.

Denso Malaysia managing director Tomoya Nakamura said it was selected to be the only production centre of semiconductors in Asean, outside of Japan; backed by Malaysia’s strong suppliers’ network, well-developed infrastructure and a business-friendly environment.”