TOKYO -- Japanese electronics-maker Sony will invest in a new factory in Nagasaki Prefecture to produce semiconductor image sensors used in smartphone cameras, Nikkei has learned. The company aims to capitalize on growing demand for high-end cameras in the devices that will take advantage of ultra-fast 5G networks.

Sony plans to allocate 100 billion yen ($918 million) for the project in its budget for the next fiscal year, and to have the plant online as soon as the fiscal year that starts in April 2021.

At that point, it will be the company's first new semiconductor plant to go into operation in five years. Sony expects the market for image sensors to continue growing as smartphone makers equip their products with increasingly sophisticated cameras. It believes demand will also get a boost as next-generation 5G networks become more widespread, and self-driving cars and factory automation come into use.

Sony was the world's biggest image sensor maker in 2018, with a 50% market share. It aims to use the new plant to lift its global share to 60% by 2025. Rival Samsung Electronics, which commands a 20% share of the global image sensor market, is also expanding its investment.

With a prolonged trade war looming in the background, Sony hopes the new plant in Japan will enable it to respond more flexibly to changes in key markets like the U.S. and China.

Sony's plant will be built on a 74,800-sq.-meter site adjacent to an existing plant in Isahaya, Nagasaki Prefecture, in southwestern Japan. It will produce complementary metal-oxide-semiconductor image sensors for smartphones. The plan will be revealed at an earnings announcement for the April to September period on Wednesday.

U.S. hedge fund Third Point, led by activist investor Daniel Loeb, has demanded that Sony spin off its semiconductor business, but the Japanese company has refused.

Sony last brought a new plant online in 2016, when it started operating a factory in southwestern Japan's Oita Prefecture that it bought from Toshiba. It is the first time in 12 years for the company to build a plant from the ground up. In 2007, it built a facility in Kumamoto Prefecture.

At present, Sony can produce about 100,000 image sensors for smartphone cameras domestically per month. It plans to boost that to 130,000 by March 2021. Until now, the company had increased output by expanding production lines at existing plants and improving efficiency, but it decided a new factory was necessary to capture the expected demand growth.

The new plant's capacity is yet to be decided, but after operations start in 2021 Sony plans to eventually increase production to tens of thousands a month.

The company decided to build a new plant because many smartphones now have several cameras. Apple's new iPhone 11, for example, has three.

Thanks to the spread of photo- and video-sharing social media like Instagram and TikTok, even midpriced smartphones costing around 50,000 yen have started mounting high-performance cameras. As a result, demand for Sony's image sensors is growing, too.

According to U.S. market research company IDC, global smartphone shipments are expected to fall 2% to 13.7 trillion units in 2019, but are then likely to increase for the first time in four years in 2020.

With the spread of 5G smartphones, demand for high-capacity video capability is expected to grow even more. Autonomous driving and factory robots are also likely to boost the market for image sensors.

Sony's image sensors are expected to have a wide range of applications, including the internet of things, autonomous driving, games and advanced medical technology, according to CEO Kenichiro Yoshida.

The company's semiconductor business posted an operating profit of 143.9 billion yen ($1.32 billion) in the fiscal year through last March -- 16% of Sony's total profits before consolidation adjustments.

Global electronics companies are increasing investment in semiconductors, anticipating a recovery in smartphone demand and the growth of 5G.

Taiwan Semiconductor Manufacturing Co., or TSMC, posted its first operating profit in five quarters in July to September. The company raised its capital spending to between $13.8 billion to $14.8 billion, up 40%-50% from the usual level.