Flosfia – which counts Mitsubishi Heavy Industries, Toyota Motor affiliate Denso and the Development Bank of Japan as investors – will mass produce power semiconductors that use gallium oxide, an alternative to silicon, as a semiconductor material.

These can reduce power loss by 70% compared with current semiconductor devices, according to the company. In addition, they can reduce EV power consumption by 10%, leading to longer cruising ranges on a single charge.

Flosfia aims to achieve monthly production capacity of several hundred thousand units by summer 2023. The devices will be sold to auto parts makers.

The company plans to outsource production to domestic electronics companies, targeting sales of ¥100 billion (US$732 million) by 2030.

As EV demand increases, the company wants to commercialise its devices before competitors in Europe and the US do.

Driving range on a single charge is a key factor in electric vehicle performance. EV makers have pushed the limits of how far their vehicles can go by improving battery performance and reducing vehicle weight.

Flosfia is one of the companies tackling the EV range challenge from the level of semiconductor materials. Besides gallium oxide, silicon carbide has emerged as a promising avenue of development. Tesla became the first of its peers to use silicon carbide power semiconductors in a mass produced car.

Power semiconductor devices control the current and voltage in motors and other EV parts. Japanese companies have a small presence in the semiconductor sector overall, but still hold an advantage in this field.

Mitsubishi Electric, Toshiba and Fuji Electric together hold about 20% of the world market share in power semiconductors. New companies like Flosfia are finding a niche in the industry with the support of the Japanese government-backed New Energy and Industrial Technology Development Organization.