The news about Rohm Semiconductor joining hands with Toshiba and Mitsubishi Electric to create a trifecta power semiconductor unit marks Japan Inc.’s strategic quest for relevance in a market increasingly defined by scale and global competitiveness. That kicks off with Toshiba Electronic Devices & Storage Corp. (TDSC), a subsidiary of Toshiba, signing a memorandum of understanding to begin discussions with Mitsubishi and Rohm.

This new company will further bolster Japan’s global presence following memory stalwart Kioxia and could become the world’s second largest power chip supplier after Germany’s Infineon Technologies. The three Japanese companies in this tie-up collectively hold 11% of the global power semiconductor market, compared to Infineon’s 24%.

Power semiconductors are a crucial segment amid high-growth markets such as EVs, renewable energy, data centers, and industrial automation. And this combo has the recipe to target these vital power electronics markets.

Rohm develops and manufactures a very large product range, including low-power MCUs, power management ICs, silicon carbide (SiC) diodes, MOSFETs and modules, power transistors and diodes, and LEDs. Its SiC device portfolio is especially crucial for EV inverters, charging systems, renewable energy, and industrial drives.

Mitsubishi Electric’s power device unit also sells SiC MOSFETs alongside other power semiconductors and driver ICs. Next, Toshiba TDSC supplies MCUs, power management ICs, and other power semiconductors.

Meanwhile, the Japanese components supplier Denso also has skin in the game. The company entered a strategic partnership with Rohm and later acquired a 5% stake in the Kyoto-based chipmaker.

The Denso twist The plot thickens with Denso’s recent attempt to acquire Rohm for an estimated $8.3 billion to bolster Toyota’s power electronics supply chain. Denso, Toyota’s key components supplier, approached the Kyoto-based chipmaker with an acquisition proposal after the two companies signed a strategic partnership to focus on chips for EVs.

One of the stark lessons from the recent Nexperia saga and the resulting troubles of Honda and Nissan is that a heavy reliance on China for semiconductors carries risks. Automakers such as Honda and Nissan were shaken after China moved to disrupt the supply of Nexperia chips manufactured at local plants.

While Rohm created a special committee to consider Denso’s offer, news of a three-way tie-up to create a power semiconductor powerhouse has further complicated this affair with Denso. If this tie-up leads to the creation of a power semiconductor unit, it’d be interesting to see Denso’s stake in this new chip firm.

It’s worth noting that, according to TechInsights data, Rohm held 2.8% of the global power semiconductor market in 2025, while Mitsubishi Electric and Toshiba accounted for 3% and 1.7%, respectively. And Denso’s share of the power semiconductor market was merely 1%.

Cost competitiveness through integration In retrospect, it’s a pretty simple call for Mitsubishi Electric to spin off its semiconductor business. The company, which specializes in industrial-based power semiconductors, has been considering various options to make its semiconductor business more competitive. Mitsubishi Electric is a leading manufacturer of industrial and electronic equipment.

Toshiba, after spinning off its memory business as Kioxia, seems to be in a similar quandary regarding scale, cost competitiveness, and new technology development. In fact, in December 2023, Toshiba’s TDSC unit joined hands with Rohm to submit to the Japanese government a production plan to a secure stable supply of semiconductors domestically.

Finally, Rohm has long been exploring the possibility of leveraging its strengths in power semiconductors and thus making its business more competitive globally in terms of scale and technology. This tie-up with Mitsubishi Electric and Toshiba TDSC offers the venue it’s long sought to bolster its standing in the semiconductor industry, domestically and globally.

It will also boost Japan Inc., which is increasingly worried about its shrinking footprint in the semiconductor industry. This consolidation will also address the concerns regarding Japan’s fragmented semiconductor market.

While it’s not a done deal yet, the rationale behind this initiative for the creation of a power semiconductor specialist looks strong. Meanwhile, another player on the outset, Toyota’s components supplier Denso, will be keenly watching the developments and its own relevance in this Japanese affair.

By: DocMemory
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