Wholly-owned Filipino semiconductor player EMS Group said its partnership with three foreign firms could fetch a combined investment of $1.6 billion with initial operation commencing next month.
In a press briefing at EMS' headquarters in Laguna Technopark Inc. (LTI) on May 3, EMS Group Chairman and Chief Executive Officer (CEO) Ferdinand "Perry" Ferrer said the projected investments would come from two partnerships with Japanese and American firms and another European firm at $800 million investments each. Ferrer refused to divulge the identity of the investors.
The partnership with the Japanese and American firms involve manufacturing of high-value power integrated circuits (ICs) for automotives.
He said that of the combined $800-million investment package from the two partners in Japan, $150 million to $180 million have already been invested in the Philippines.
The IC for automotive product itself is similar to products already done in the country. However, this operation, which will start next month, will involve a "process," described by Ferrer as "a couple of processes before assembly, testing, and packaging" that will be done for the first time in the Philippines.
The low rate initial production is being done this year in LTI, with the full production to shift to a Philippine Economic Zone Authority (PEZA) zone in Batangas.
"2025, we'll have to get a larger factory, but 2026 will be the full rate production. Currently, we're doing low-rate initial production. Testing the waters here in the Philippines," said Ferrer.
The project is expected to generate 2,500 to 3,000 new jobs by 2026.
The products to be manufactured will be direct exports or finished products to be exported to the US and European Union.
The current "proof of concept" with these Japanese and American firms includes a subcontractor arrangement where in EMS is running their factory in the Philippines, "to prove how good Filipino workers are, the high quality workmanship that's given, and (technical) communication," he explained.
Meanwhile, the other $800 million worth of investment from a still unnamed European brand is already 95 percent certain to enter the country, said Ferrer, perhaps in the second half of 2024 in a Batangas PEZA zone.
The operations, which will involve manufacturing high-end consumer products, specifically for hair care, is expected to generate around 5,000 to 6,000 jobs.
Ferrer said two factory operations from subcontractors of this European brand have already begun. By the first quarter of 2025, the third, last, and largest operation may enter the country.
EMS said it had flat growth in 2023 with less than P5 billion in revenue, with the growth driven by operations in contract manufacturing.
"Semiconductor market is soft but will pick up. We're making strides in trying to position Philippines in IC design, aside from ATP (assembly, test, packaging)," said Ferrer.