Samsung eyes W1tr in sales of pricey capacitors for cars

Samsung-Electro Mechanics, a leading electronic parts maker affiliated with Samsung Electronics, has set a sales goal of 1 trillion won ($736 million) for its flagship Multi-Layer Ceramic Capacitor or MLCC products this year, strategically targeting the automotive sector.

"Leveraging our technological prowess nurtured in the IT sector, the company aims to expand its portfolio to servers for AI services and automotive solutions, the two burgeoning markets for MLCC," Kim Wi-heon, the MLCC development chief at Samsung-Electro Mechanics, said during a media briefing on Friday.

MLCCs regulate the flow of current in a circuit and prevent electromagnetic interference between components inside electronic devices. The sizes of MLCCs range from 0.4 millimeters by 0.2 mm to 5.7 mm by 5 mm. A human hair is about 0.3 mm.

As the products use pricey materials and advanced manufacturing technologies, a 500 mm wine glass of MLCCs is priced at about 300 million won.

Samsung is especially betting big on automotive solutions, the burgeoning and lucrative market for high-priced MLCCs.

While about 1,000 MLCCs are used in a smartphone, the figures soar to some 18,000 to 20,000 units for an electric vehicle.

Samsung has diversified its MLCC product lineup for automotive solutions from powertrains and braking systems to advanced driver-assistance or ADAS systems.

This year alone, the company has launched two types of 16-volt MLCC for ADAS, the world’s highest capacity level, and an MLCC for EVs that resists high voltage of up to 1000V.

Compared to those for IT devices, automotive solutions are required to guarantee higher reliability and durability. While the average guarantee lasts three years for IT products, the period extends to 15 years for automotive solutions as they are directly linked to driver safety.

"Samsung Electro-Mechanics is developing ultra-small and ultra-high-capacity products, and is striving to develop high-reliability, high-quality, high-tech MLCCs,” Kim added.

According to the company, the global MLCC market will be valued at $13.1 billion in 2024, up 7 percent on-year. By segment, the automotive sector is expected to see an annual growth rate of 12 percent, more than double the 5 percent rate of the IT sector.

Samsung operates its key production and development facilities in Suwon, Gyeonggi Province, and Busan. The Busan plant, in particular, is equipped with facilities for material development for a stable supply. It also has production bases in Tianjin, China and the Philippines.

For its whole automotive solution business ranging from MLCCs to camera modules and chip parts, the company aims to hit 2 trillion won in sales next year.