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Japan aircon king Daikin looks to custom chips for energy savings

The mascot of Daikin Industries is pictured at Daikin's office in Tokyo, Japan, November 30, 2023. REUTERS/Sam Nussey
The mascot of Daikin Industries is pictured at Daikin's office in Tokyo, Japan, November 30, 2023. REUTERS/Sam Nussey

Regarding energy savings, the Japanese air conditioner manufacturer Daikin Industries (6367.T) is resorting to custom-made semiconductors. This comes at a time when businesses are increasingly looking to bespoke chip designs to increase performance.

Companies that use legacy chips are contemplating the introduction of custom silicon at the same time as tech giants like Apple (AAPL.O) and Amazon (AMZN.O) are investing a significant amount of money in developing cutting-edge custom chips.

According to Daikin, which has its headquarters in Osaka and anticipates producing 10 million residential air conditioners during the current fiscal year, the business has announced that it would be collaborating with a Japanese design company to personalize logic chips for the inverters that are used in its air conditioners.

Inverters allow for adjusting the speed of an air conditioner’s motor, which aids energy conservation. They are considered standard in Japan and the European Union; however, in the United States, they are not as frequent.

An executive from Daikin stated that although the bespoke chips are more expensive than alternatives that are available off the market, they provide superior energy efficiency and make it possible to reduce the number of other components that are used.

According to Yuji Yoneda, the general manager of Daikin’s Science and Innovation Center, “We need to improve chip performance, or we will hit a limit.” This statement was made in an interview. “To bring out the full performance of an air conditioner’s compressor and motor, we must improve chip performance.”

Daikin intends to begin incorporating the chips into high-end air conditioners beginning in the year 2025, and the company is considering incorporating them into around one-fifth of units by the time the decade comes to a close.

Additionally, the business is working on individualized power modules to assist in managing the air conditioner’s electrical supply. In 1951, the company was responsible for developing Japan’s first packaged air conditioner.

As a result of a steady inflow of investments in the local semiconductor business, Daikin has been recruiting engineers from the chip industry to work on customization. This is being done even though the company is struggling with competition.

Daikin hopes that a greater emphasis on energy efficiency will be a positive windfall for the business. According to the International Energy Agency, the number of air conditioners worldwide is anticipated to quadruple to 5.6 billion units by 2050.

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