Murata Eyes India for Production Expansion Amid Global Supply Chain Shift

Murata Manufacturing Co., a key supplier of iPhone components, is evaluating the possibility of shifting part of its production capacity to India, reflecting a broader global supply chain realignment toward the world’s most populous country.

According to Murata President Norio Nakajima, the Kyoto-based company is exploring increased investments in India to meet rising local demand and align with customers’ requests for business continuity planning. Currently, 60% of Murata’s multilayer ceramic capacitors (MLCCs) are produced in Japan, but this share is expected to decline to 50% in the coming years. Murata, a leading global supplier of capacitors, plays a crucial role in power regulation for electronic components across smartphones, servers, and gaming consoles.

With Apple shifting parts of its production beyond China, including AirPods trial production in India, and Chinese smartphone manufacturers expanding their manufacturing footprint in India, Murata is taking strategic steps to support this transition. The company has leased a plant at OneHub Chennai Industrial Park, Tamil Nadu, for ¥1 billion ($6.6 million) over five years. This facility, operational from April 2026, will package and ship ceramic capacitors—a move designed to assess long-term demand before committing to a fully integrated production facility.

Nakajima noted that India’s infrastructure still requires further development, particularly in areas like power supply, before Murata can consider setting up a large-scale factory. However, the company wants to establish an early presence to respond swiftly to future manufacturing incentives introduced by the Indian government.

Despite expanding in India, Murata has no immediate plans to build facilities in the US, as its capacitors are primarily used in products assembled in Asia before export. However, concerns over US trade policies and tariffs remain, as potential price surges could impact global demand.

With AI-driven server demand rising and smartphone shipments expected to grow by 3% annually, Murata sees India as a crucial market in the evolving global electronics landscape.

Source: Moneycontrol