The semiconductor factory in Kofu, in rural Yamanashi Prefecture west of Tokyo, stood empty for eight years.

Renesas Electronics no longer needed the building and, according to its own statements, did not come to an agreement with any potential buyer or tenant.

But now Renesas is investing 90 billion yen (around 635 million euros) to reopen the factory.

From 2024 onwards, power semiconductors will be produced in an 18,000 square meter clean room with 300 millimeter wafers.

These computer chips regulate the flow of electricity and are gaining in importance with the shift to electric cars.

Renesas markets the decision as a contribution to moving away from the carbon economy.

When the new old factory is completed, the company will double its production capacity for power semiconductors.

Patrick Welter

Correspondent for business and politics in Japan based in Tokyo.

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The investment in Yamanashi reflects the ongoing bottlenecks in the semiconductor industry, but also the big world politics.

"Anyone who is serious about power semiconductors needs their own production capacities," says Renesas boss Hidetoshi Shibata in an interview with the FAZ. The investment decision was also based on the greater awareness of geopolitical risks.

"With the situation in Ukraine adding to years of tensions between the United States and China, the balance between efficiency and business resilience is being questioned around the world," says Shibata.

In his opinion, it is becoming more important to divide research and development, but also production, between different regions.

This has consequences for the distribution of the locations of the semiconductor industry in the world.

"Regions like Europe or Japan will become much more important if efficiency is no longer the priority," says Shibata, head of one of the most important suppliers for the automotive industry in Japan.

Spatial diversification is becoming increasingly important

With its 21,000 employees, Renesas generates almost 30 percent of its sales in Japan and a further 47 percent in China and the rest of Asia.

European customers contribute around 15 percent to sales.

Shibata emphasizes a special interest in further investments in Germany because the country, with its focus on electric cars and industry, attracts important customers.

“At least so far”, however, Renesas has no concrete plans for new production facilities in Germany.

However, Shibata emphasizes that Renesas is constantly looking for “new talent” in order to strengthen research and development in Germany and Europe.

With the takeover of the British Dialog Semiconductor last year, Renesas also strengthened its activities in Germany.

Around 1000 employees at eight locations work for Renesas in Germany.

Part of the geographical diversification is that Renesas has around 200 employees in Lemberg in western Ukraine doing research and development.

The team works hard to keep work from the office or home going, Shibata says.

So far there have been no significant disruptions.

Not only semiconductor companies, but also governments are increasingly following the theory of necessary spatial diversification, including in Germany and Japan.

The subsidy race to locate new semiconductor factories has begun.

The Japanese Ministry of Industry is giving up to 476 billion yen (3.4 billion euros) to the Taiwan Semiconductor Manufacturing Company (TSMC) for the construction of a semiconductor factory in the southwestern Japanese town of Kumamoto, in which the electronics company Sony and the automotive supplier are also involved as junior partners and important domestic customers participate.

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