TL; DR
- Murata, a capacitor maker is considering manufacturing in India.
- Murata starts with a leased facility, testing the waters before major investment.
- The company expects AI demand to fuel growth, supporting the India expansion strategy.
Murata Manufacturing Co., a key iPhone components supplier, is considering expanding its production capacity in India. The Kyoto-based firm is known for making multilayer ceramic capacitors (MLCCs) found in everything from smartphones to AI servers, gaming consoles to even NASA’s Mars-bound helicopter. The company is running simulations to gauge investment needs in India, President Norio Nakajima revealed.
Murata currently produces 60% of its MLCCs in Japan. But Nakajima expects this to drop to 50% as customers push for geographically diversified suppliers to ensure business continuity. “Customers are asking us to manufacture more overseas… due partly to business continuity planning purposes,” Nakajima stated
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After seeing Apple’s India manufacturing push, Murata leased a facility in Tamil Nadu’s OneHub Chennai Industrial Park, planning to package capacitors there by April 2026. The five-year, $6.6 million lease serves as a “test” for long-term demand before committing to full-scale manufacturing.
“India’s infrastructure, like power supply, isn’t yet ready for integrated production, but we need early capacity as customers move,” Nakajima said. He highlighted India’s booming electronics demand and potential government incentives as key motivators.
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Notably, Murata has no plans to build U.S. facilities, as its capacitors are embedded in products assembled in Asia. While U.S. tariff policies under Trump sparked internal discussions, Nakajima emphasized broader concerns over consumer price spikes denting capacitor demand.
Looking ahead, Murata forecasts global smartphone shipments to rise 3% in 2024 to 1.18 billion units, driven by emerging markets. However, faster growth is expected from AI server demand, which boosted Murata’s stock by 15% post-February earnings.
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