Coherent CEO: SiC Invested by DENSO and Melco, “Securing Stable Supply for EVs” Yoichiro Hiroi, Yuka Konishi

Nikkei Mobility

November 7, 2023

This page presents an English translation of an interview with Vincent Mattera, CEO of Coherent Corp. The original interview, conducted in Japanese, is available here.


DENSO and Mitsubishi Electric (Melco) have decided to invest in the silicon carbide (SiC) business of an American semiconductor wafer manufacturer. Vincent Mattera, Chairman and CEO of Coherent, gave an interview to NIKKEI Mobility. Demand for SiC substrates is expected to increase, and he said, “We aim to strengthen the Japan-U.S. supply chain for electric vehicles (EVs) by ensuring stable supply to manufacturers.''

“Monozukiri (art of manufacturing)” to cement reliability

Tell us more about the investment of $500 million (approximately 75 billion yen) you received from Denso and Melco (12.5% stake each).

“We will spin off our SiC business into a separate company. Coherent will own 75% and maintain control. With investments from Denso and Melco, the company will enhance its production capabilities and invest in development of the manufacturing technology needed for scale expansion. Full-scale production of 200mm wafers (substrates) will begin around 2027. We will expand our scale through partnerships and aim to achieve 20% annual sales growth from 2027 onwards."

“Our productivity will be enhanced with the long-term supply contracts with client companies. As Denso and Melco expand their production scale, they will learn more about the materials. That knowledge will be fed back to us and lead to improvements in manufacturing technology. We will refine our own technology through collaboration with customer suppliers. “Monozukuri (manufacturing)” requires efficient and controlled technology processes, which leads to improved product performance and reliability.

Why did you decide to spin off the SiC business?

"We thought the most effective way to receive outside investment was to create a separate company. This is because it helps ensure that the invested funds are used only for the SiC business. It increases transparency about our production capacity and plans. Meanwhile, we will have a controlling interest in the new company and it will be managed by Coherent."

Many companies are interested in the investment

Do you have any plans to set up a production base in Japan?

"We have no plans to manufacture SiC in Japan, and are focusing on sales and service, as well as closer and faster communication with customers here. We are building a solid logistics system to ensure accurate product delivery. We will deepen our relationship with the ecosystem of Japanese industry such as SiC, compound semiconductors, and laser technology."

The Ministry of Economy, Trade and Industry is providing large amounts of subsidies to foster the semiconductor industry.

“We are aware of the Japanese government's initiatives and we think it will be important to pursue and understand what business opportunities exist in those context.”

Will only these two companies be investing? Is there any possibility of inviting additional investment?

"DENSO and Melco will have a right to make an additional investment of $500 million within six months of signing the investment agreement. But many other companies can also opportunities to invest although we cannot say anything concretely at this stage. Some companies have expressed interest in the investment."

Exponential growth towards 2030

Isn't there a risk that your clients will be limited if you receive investments from specific companies?

“We have communicated to all our customers our intention to continue to grow and contribute to the market as before. Being well capitalized is good news for our customers.”

What is the driving force behind your market expansion?

"Although SiC accounts for a small portion of the semiconductor market, we believe it will increase exponentially towards 2030. The market is expanding, especially around EVs. The advent of generative AI will require even more electricity. There will be a strong need to control electricity more efficiently."

What will the name of the new company be? Do you have a plan for IPO at some point?

"The name of the subsidiary will be 'Silicon Carbide' which could be rebranded in the future. There is a possibility of an IPO, but it is still just a possibility."


Coherent is a major manufacturer of optoelectronic components and has strengths in laser technology. It also manufactures other materials, including semiconductor wafers. Sales for the fiscal year ended June 2023 was US $5.1 billion (approximately 770 billion yen).