While avoiding US expansion, component manufacturer Murata is considering relocating production to India, with plans to lease a facility in Tamil Nadu.
Japan’s Murata Manufacturing, a key supplier of iPhone components, is considering relocating part of its production capacity to India as the global supply chain increasingly shifts towards the country.
The Kyoto-based company, known for its multilayer ceramic capacitors (MLCCs), is seeing growing demand in India, prompting it to assess the potential for increased investment there, as Murata President Norio Nakajima confirmed.
In line with this, Murata has reportedly leased a facility in OneHub Chennai Industrial Park in Tamil Nadu, where it plans to package and ship capacitors starting in April 2026.
Murata’s components are integral to a variety of electronic devices, including smartphones from Apple and Samsung, game consoles from Sony, and servers from Nvidia.
Presently, the company manufactures around 60 per cent of its MLCCs in Japan, though this is expected to decrease to approximately 50 per cent in the coming years. It is responding to customer requests for more overseas production, partly due to business continuity planning.
Murata is cautious about building a full production plant in India due to infrastructure issues, including unreliable power supply. However, it is looking to establish a presence there, driven by rising consumer demand and potential government incentives.
On the other hand, the company has no plans to set up operations in the US, as its capacitors are mainly used in products assembled in Asia.
Murata also expressed concerns about the indirect impact of tariffs, particularly those under former US President Donald Trump’s policies, which could lead to higher consumer goods prices and reduced capacitor orders.
According to Bloomberg’s report, the company forecasts global smartphone shipments will grow modestly by 3 per cent annually, with stronger growth expected in server demand, especially for AI. Murata’s stock has risen by 15 per cent following strong earnings, partly due to AI demand.
Murata expects global smartphone production to reach 1.18 billion units in fiscal 2024. Analysts predict that as the semiconductor market grows, so too will the demand for Murata’s MLCCs and other components, benefiting the company in the long term. Additionally, its radio-frequency modules, like MetroCirc, are expected to see growth as 6G technology rolls out.
