Japan’s Nidec to unify chip procurement amid supply crunch

Nidec Corp’s logo is pictured at an earnings results news conference in Tokyo, Japan, July 25, 2018. REUTERS/Kim Kyung-Hoon

TOKYO, June 7 (Reuters) – Electric motor maker Nidec Corp (6594.T) on Tuesday said it would combine group semiconductor purchases into a single procurement unit to strengthen ties with chip makers and ensure it could source key components amid continued uncertainty over supplies.

“The chip industry environment is more uncertain than it has ever been,” said Ryuji Omura, deputy chief technology officer of Nidec, makes motors for electric vehicles, household appliances and other products.

The company’s decision to centralize procurement is a sign that chip shortages, which have affected automakers in particular, may persist and are forcing companies to implement more aggressive measures to ensure they have enough components to meet demand for their products and devices.

Toyota Motor Corp(7203.T), the world’s biggest carmaker by volume,cut its global production plan this month by 100,000 vehicles because of chip shortages and other pandemic-related disruptions.

Denso Corp (6902.T), one of Toyota’s key parts suppliers, in February agreed to buy a 10% stake in a semiconductor plant being built in Japan by Taiwan Semiconductor Manufacturing Co (2330.TW)to help secure supply of microcontroller chips. read more

Omura said that, as part of its “make or buy” procurement strategy, Nidec would also work more closely with suppliers in chip design and production. He spoke during a presentation on the company’s new chip strategy.

The company is expanding production of energy saving e-axle electric-vehicle motors in a bid to capture as much as 45% of the expanding global market by 2030.

Reporting by Tim Kelly; Editing by Tom Hogue and Bradley Perrett

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