00:00Mitsubishi Electrics looking to reach a deal by September with rivals Toshiba and Rome.
00:04Speaking exclusively with Bloomberg, CEO Kei Rumma says the move is to consolidate three of the world's top suppliers in
00:11the electronic supply chain.
00:16Looking at Japan today, there are many power semiconductor manufacturers.
00:21I believe having so many domestic players leads to wasted development resources.
00:26Combining our forces will allow us to go head-to-head with our global rivals.
00:30That was the starting point of our thinking.
00:33By teaming up with Rome and Toshiba, we can streamline developments, produce low-cost chips, and manufacture high-value semiconductors.
00:42Do you have then a timeline for this alliance to be formed?
00:46And in what parts of your business would the alliance actually be reflected?
00:55Our goal is to consolidate sales, manufacturing, and development to build one single robust company.
01:02The three companies are currently working out the detailed terms of the agreement and making adjustments.
01:08We hope that by September we'll be able to announce our plan to establish the joint venture.
01:12How much is the Japanese government also helping in this endeavor to really help everything related to semiconductors and the
01:21AI business?
01:22And does that affect your company as well?
01:25To be completely honest, we aren't receiving any support from the government at the moment.
01:33Once we join forces of Rome and Toshiba, I hope the government will reconsider.
01:38In other countries, state subsidies help significantly lower depreciation costs.
01:43Without that support, even with a joint venture, our costs will remain higher than our competitors.
01:49We just want a level playing field.
01:51If we can get those subsidies, it would be a massive help.
01:54When it comes to the Japanese government, we have seen that now lift the ban on defense exports.
02:00How much will that help your business?
02:06I believe this is going to have a very significant business impact moving forward.
02:12Before the five categories restrictions were lifted, we were actually the very first to export defense equipment, delivering our radar
02:19systems to the Philippines.
02:21But back then, with those bans in place, exporting was always extremely difficult.
02:26Now that those barriers are gone, it's going to be much easier for third-party countries to approach us with
02:32those specific requests and product needs.
02:34At the same time, we can now consult closely with the Ministry of Defense to respond to those needs and
02:40much more effectively.
02:41Working with the Ministry will bring entirely new business opportunities, and we look forward to that.
02:47I think you recently said that your defense and space segments' revenue should be doubling from fiscal 2025 to 2030.
02:55Are you still attracted to that?
02:57Right now, we're aiming for 800 billion yen by 2030.
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