Japan-backed JS Foundry filed for bankruptcy 2.5 years after launch with ¥16.1B debt

JS Foundry was set up in December 2022 by Mercuria Investment, an affiliate of the government-linked Development Bank of Japan, and independent financial advisers Sangyo Sosei Advisory. It bought a Niigata Prefecture plant built by Sanyo Electric in 1984 and sold in 2011 to US chipmaker Onsemi, to make power semiconductors used in electric vehicles, home appliances and trains. A fund run by DBJ was among its backers.

On 14 July 2025 the Tokyo company filed for bankruptcy protection with the Tokyo District Court, leaving debt of ¥16.1 billion (about $110 million). Nikkei Asia reported operating cash shortages and trouble finding customers as Chinese chipmakers increased their market presence. Sales were ¥10 billion in its first year but slid to ¥2.6 billion in the year to December 2024 after a production arrangement with Onsemi ended. Of about 550 staff, around 200 were dispatched to other companies.

The power-chip market had deteriorated since the second half of 2023, as electric-vehicle demand fell short of projections. In 2025 JS Foundry opened talks with overseas companies on a capital tie-up to enter silicon carbide power chips, but the talks collapsed and the company decided to file. The bankruptcy came ahead of a disbursement of a few billion yen in subsidies from central and local governments.

¥16.1B (about $110M) of debt left outstanding; sales fell from ¥10B in its first year to ¥2.6B in 2024.

JS Foundry depended on a production arrangement with Onsemi, and its sales fell from ¥10B to ¥2.6B after that arrangement ended.

It struggled to find new customers as Chinese manufacturers increased production.

Demand for power semiconductors fell short of electric-vehicle projections from late 2023.

The attempt to enter silicon carbide through an overseas capital tie-up fell through.

A foundry bought with state-linked money still needs anchor customers. When the supply deal with the seller ends, replacement demand must already be signed, not hoped for.

Nikkei Asia said the collapse came amid wider turmoil in power semiconductors: US-based Wolfspeed filed for Chapter 11 in June 2025, Renesas was expected to book a loss of about ¥250B on its Wolfspeed financing, and Rohm posted its first net loss in 12 years for the year to March 2025.