Renesas-CG Power venture likely to roll out first chip by mid-2026, says Hidetoshi Shibata

Economic Times

14-05-2025

Hidetoshi-Shibata-renesas
Japanese semiconductor firm Renesas Electronics Corporation expects its chip assembly joint venture with Murugappa group's CG Power and Thailand's Stars Microelectronics to roll out its first chip from a pilot production line by mid-2026, its global CEO Hidetoshi Shibata told ET.The Rs 7,600-crore plant in Sanand is slated to start mass production in 2027, he said, adding that Renesas is also in talks with other potential Indian partners to expand its presence in the country at various levels, even as it is extremely bullish on its partnership with CG Power.India-Pakistan tensions following the Pahalgam terror attack caused some "near-term technical issues" that needed to be dealt with, but that hasn't deterred the company's push to double down in Gujarat, which is a border state, Shibata said on Tuesday."A country like India will not do anything detrimental to the prosperity of the country,' he said. 'There are some conflicts, but I do strongly believe India will not do anything above and beyond. (Do I) have a doubt about the prospect of the industries in a state like Gujarat? Absolutely not."The $10 billion Renesas—listed on the Tokyo Stock Exchange and a supplier to auto giants like Toyota Motor Corp and Honda Motor Co—counts India as a large market. It supplied the Chandrayaan-3 space mission with more than 30 radiation-hardened components and is a major player in the smart metering space in the country.
Shibata spoke to ET ahead of Renesas' expansion of its Bengaluru and Noida centres to accommodate its growing R&D teams.
'(This is the) first time three-nanometre chips will be designed in our country,' union electronics and information technology minister Ashwini Vaishnaw said at the inauguration in Noida.Renesas has partnered with the Ministry of Electronics & Information Technology (MeitY) to support local startups and academic institutions in VLSI (very large-scale integration) and embedded semiconductor systems.Vaishnaw said the country is growing electronics manufacturing at a rate of double-digit CAGR, which 'will create a lot of employment, demand, and self-reliant solutions.' Also, while developing the semiconductor industry in the country, 'we are working at all the parts of the value chain," he said.While Renesas' priority remains the outsourced semiconductor assembly and test (OSAT) facility in Sanand, Shibata did not rule out the possibility of establishing a fab in the country.'Everything is a possibility,' he said. 'But for now, I do see CG Power as a very like-minded partner... We are now focused on really ramping up the facilities that we are working on. The rest should follow that."
When asked what India should do to further cement its position as a semiconductor manufacturing hub, Shibata highlighted the importance of intellectual property (IP). While India has made tremendous progress in terms of setting up shop in production, be it the front end or back end (design), it is now time to be more aggressive on design and intellectual property—both software and hardware, he said.'If you just produce those products, chances are you will be serving to companies from other parts of the world,' Shibata said. 'That's not interesting to a big country like India. You have to take control of the semiconductor and electronics value chain, end to end, and to do so, the upstream capabilities of intellectual properties will be crucial,' he said.He also believed that with the emergence of generative AI and India not having the "baggage" from the conventional way of semiconductor design and usage, the country is well positioned to think more creatively about the design, usage and lifecycle management of semiconductor devices.'And that's what I'm trying to do…if we can find a great India partner." He said. 'I do look at CG Power as potentially one of them (partners).'Vaishnaw also stressed the need to develop intellectual properties (IPs) at the inauguration.'We are now going into developing our own IP,' the minister said. 'We have already taken a call to design 25 chipsets. Some of them are very critical chipsets—high value, low volume—but going into some of the major important systems. It may take two years or even three years to reach a good level of progress in that, but the journey must begin,' he said.As for the Renesas' focus areas, Shibata said electric vehicles (EVs)—be it two-wheelers, three-wheelers or four-wheelers—and related infrastructure is one of the most promising areas. Industrial vehicles was also an interesting opportunity, he said.'But in longer term, I really wanted to contribute to India in elevating its electronics capabilities around healthcare,' Shibata said. 'So, hopefully, we will do a good job in drawing the healthcare electronics capabilities in India in a way that you can serve a growing need from the domestic market of India.'