(Bloomberg) -- Japan is earmarking ¥129.4 billion ($902 million) to Rohm Co. and Toshiba Corp.’s joint push to boost production of power semiconductors, seen as key to lifting energy efficiency in electric vehicles and factories.

The two Japanese companies said Friday they will spend ¥388.3 billion to jointly manufacture power devices, with an emphasis on silicon carbide and silicon chips to meet demand for smaller and lighter powertrains from the EV industry as well as efficient and stable devices from plant automation. Japan’s Ministry of Economy, Trade and Industry would subsidize about a third of the cost.

“It is essential that domestic power semiconductor manufacturers work with one another to improve Japanese industry’s international competitiveness,” Economy Minister Yasutoshi Nishimura said at a regular news conference Friday. The ministry has been encouraging more collaboration among the country’s chipmakers, he said.

Toshiba will boost production capacity of silicon power devices at an upcoming plant in Ishikawa Prefecture, while Rohm affiliate Lapis semiconductor will lift production capacity of silicon carbide devices and wafers at a plant in Miyazaki Prefecture, the companies said. 

The plans were reported earlier by the Yomiuri newspaper and public broadcaster NHK.

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